In the United States Court of Federal Claims 

No. 15-156C 

(Filed: July 21, 2015)* 

*Opinion originally filed under seal on March 23, 2015 

KWR CONSTRUCTION, INC. 

 Plaintiff, 

v. 

THE UNITED STATES, 

 Defendant. 

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) 

) 

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) 

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) 

Bid Protest; Price Completeness; Price 

Reasonableness; Price Realism; 

Remand to Agency 

 

 

Frances J. Haynes, Phoenix, AX, for plaintiff. 

Matthew P. Roche, Civil Division, United States Department of Justice, 

Washington, DC, with whom were Benjamin C. Mizer, Acting Assistant Attorney 

General, Robert E. Kirschman, Jr., Director, and Franklin E. White, Jr., Assistant 

Direector. Erika L. Whelan Retta, Air Force Legal Operations Agency, Joint Base 

Andrews, MD, of counsel. 

O P I N I O N 

FIRESTONE, Judge. 

Pending before the court are cross-motions for judgment on the administrative 

record filed by plaintiff, KWR Construction, Inc. (“KWR”), and defendant the United 

States (“the government”), in connection with the United States Air Force’s (“agency”) 

award of Contract Nos. F4887-14-D-0002, FA4887-14-D-0003, FA4887-14-D-0004, and 

FA4887-14-D-0005 to Herman Construction Group, Inc. (“Herman”), Rore, Inc. 

(“Rore”), Mirack & Macro-Z Technology (“M & M”), and Premier Engineering 
 2 

Corporation (“Premier”). In its complaint filed under 28 U.S.C. § 1491(b), KWR alleges, 

among other things, that: (1) the Air Force’s determination that KWR’s price proposal 

was unacceptable on the grounds that it was incomplete, unreasonable, and unrealistic is 

not supported by the record and thus the decision to eliminate KWR from the competition 

was irrational; (2) the Air Force violated procurement law by phoning KWR and 

encouraging KWR to lower its prices in connection with an amendment to the solicitation 

that required offerors to review their price proposals; (3) the solicitation’s price terms and 

evaluation standards violated the FAR; (4) the Air Force applied more stringent standards 

to KWR’s price evaluation than to the other offerors and the awardees; (5) the Air Force 

engaged in bad faith tradeoffs; and (6) the Source Selection Evaluation Board’s (“SSEB”) 

decision failed to provide the best value for the government by failing to consider KWR’s 

past performance evaluation prior to rejecting its price proposal. 

For the reasons that follow, the court finds that KWR’s challenges to the Air 

Force’s rejection of its price proposal are well-founded and that a remand to the Air 

Force is necessary in order for the Air Force to properly explain its rejection of KWR’s 

price proposal with a reasoned explanation or adopt a different decision with a reasoned 

explanation. 

I. Background 

A. The Procurement 

At issue in this case is a Multiple Award Construction Contract (“MACC”) 

Indefinite-Delivery Indefinite-Quantity for Luke Air Force Base in Glendale, Arizona. 

Administrative Record (“AR”) 1447, 1625. The MACC will be used to award multi-
 3 

discipline construction requirements (i.e., civil, mechanical, electrical, demolition, etc.) 

with additional capability to perform large-scale design build projects necessary to 

support larger requirements at Luke Air Force Base. AR 1625. Under the terms of the 

MACC, contractors are to furnish all plant, labor, material, equipment, transportation, 

and supervision necessary to accomplish each task order in accordance with the contract, 

specifications, and additional terms and conditions. Id. The Air Force anticipated 

awarding three to five contracts, which represented the best value in the areas of past 

performance and price, to include a base year period beginning on August 1, 2014, and 

four one-year option periods. Id. at 183, 1447. The solicitation, RFQ FA4887-13-R0005 (solicitation or RFP), was posted to Federal Business Opportunities website on June 

20, 2013 with a closing date of July 30, 2013. Id. at 118. 

1. Relevant Solicitation Provisions 

The evaluation process was set out in Section M(C)(1) of the Solicitation which 

stated that “[e]ach step of this process is codependent upon the step immediately 

preceding; the government will only rate those proposals in Step 2 [Price of 

Demonstration Project] that were deemed Acceptable in Step 1 [Technical Acceptability]. 

At the conclusion of Step 2, the government would evaluate Past Performance of the 

lowest priced acceptable offerors, assign a Past Performance Confidence rating and 

continue in succession based on price assigning Past Performance Confidence ratings.” 

Id. at 189. Accordingly, a technical proposal that was “Unacceptable” in Step 1 would 

not be evaluated in Step 2; in turn, a price proposal that was not complete, reasonable, 

and realistic in Step 2 would not be evaluated for past performance in Step 3. Id.
 4 

With respect to the price evaluation performed in Step 2, the Solicitation provided 

that proposals would be evaluated in three ways. First, the Air Force would determine 

whether the price submission was complete, providing “[a]ll information/data required by 

the solicitation” and that all information received was free of omissions or errors. Id. at 

186, 189. Second, prices would be evaluated for reasonableness; that is, the total price 

“represents an amount that a prudent person would pay in a competitive business 

environment.” Id. at 186. Third, the agency would determine whether the price proposal 

was realistic. Section M(B)(1)(b)(i) and Section M(B)(3)(d) of the Solicitation provide 

that “[r]ealism is based on the items of the demonstration project price proposal to 

determine whether prices are realistic for the work to be performed, reflect a clear 

understanding of the requirements, and are consistent with the various elements of the 

offeror’s technical proposal.” Id. The Solicitation provided that “[u]nrealistically low or 

high prices may be grounds for eliminating a proposal from competition on the basis that 

the offeror does not understand the requirement.” Id.

The Solicitation also stated that the “Government intends to evaluate proposals 

without discussions with offerors. Therefore, it is imperative that each offeror submit 

their best terms with their initial proposal . . . . Offerors will not assume that they will be 

contacted or afforded an opportunity to qualify, discuss or revise their proposals.” Id. at 

173-74. 

2. Amendments to the Solicitation 
 5 

Eight amendments were issued before initial proposals were due. See generally 

Id. at 194-248. The RFP’s closing date was extended from July 30, 2013 to August 5, 

2013 to account for these changes. Id. at 118, 238. 

B. Initially, the Source Selection Board Approved KWR’s Proposal 

On August 5, 2013, the Air Force received twenty-five proposals; it anticipated 

issuing awards within 120 days of receipt. Id. at 1447, 118, 233. The SSEB conducted 

an initial evaluation of the 25 proposals received. Id. at 1633. The SSEB found 13 of the 

proposals received, including KWR’s, to be technically acceptable during Step 1 of the 

evaluation. Id. In Step 2, the Air Force evaluated the price proposals of the 13 

technically acceptable offerors, of which 11 were found to be “complete, reasonable, and 

realistic” in accordance with the solicitation, including KWR’s. Id. at 1633-34. KWR’s 

price proposal was then evaluated for past performance during Step 3, which resulted in a 

performance confidence rating of “Substantial Confidence.” Id. at 1953 n. 4. 

C. Prior to Award, the Air Force Amended Its Solicitation Again to 

Require Offerors to Provide Updated Resumes and Verify Pricing 

 

Although the evaluation process was concluded in a timely manner, various 

events—including the sequestration and furloughs of Government personnel—resulted in 

significant delays to the award of the contracts. Id. at 1947. Accordingly, the Air Force 

issued Amendment 0009 on April 23, 2014, requesting that offerors verify that the prices 

in the proposal were still current (or provide updated pricing with a detailed explanation 
 6 

underlying the changes) and resubmit resumes of key personnel to account for any 

changes in employment.1

 Id. at 242-43. Amendment 0009 stated: 

The purpose of this amendment is to obtain current resumes (Factor 1, 

Subfactor 3 – Management Plan) of key personnel in accordance with 

Section L(B)(1)(c)(2) and any unit price changes (Factor 2 – Price 

Proposal) in accordance with Section L(B)(2)(a), due to the duration of 

elapsed time since receipt of proposals, Offerors are urged to submit in 

strict compliance with both the Section L references above and the table 

found at Section M(B)(1)(d)(iii). It should be further noted that any unit 

price changes in response to Factor 2 – Price Proposal shall include detailed 

explanations for any resultant unit price changes to the price proposal 

submission. 

Id. at 1150. Offerors were also asked to extend the proposal acceptance period and 

instructed to respond to Amendment 0009 by April 30, 2014. Id. 

D. After KWR Revised Its Offer, the Source Selection Evaluation Board 

Found KWR’s Price Proposal Unacceptable 

After receiving the responses to Amendment 0009, the SSEB performed new 

evaluations of proposals that had been revised. See id. at 1948 n.1. KWR’s offer was reevaluated because it had submitted a revised price proposal. Compare id. at 677-78, with 

id. at 781-82. In its submission following Amendment 0009, KWR stated: “KWR 

Construction Inc. appreciates the opportunity to update our Price Proposal to reflect 

current commodity conditions and labor hour estimates. Our overhead factors have 

 

1

 Prior to the issuance of Amendment 0009, the contracting officer called offerors to inform them 

that the amendment was being issued and its requirements—that is, updated resumes and 

verification that prices were still current. See AR 1146-48. Because calls are not included in the 

record, it is not known whether the CO called all offerors. He then emailed the amendment and 

accompanying memorandum to each of the 25 offerors. Id. 
 7 

recently changed due to current volume of work in progress. We have lowered our profit 

margin in order to be as competitive as possible.” AR 780. 

 In evaluating KWR’s revised price proposal, the SSEB noted several deficiencies 

in KWR’s Construction Cost Estimate Breakdown (AF Form 3052). Id. 1416, 5264-

5267. The summary sheet taken from the evaluators also states that KWR’s proposal was 

also unreasonable and unrealistic based on its pricing. Id. In particular, the evaluation 

summary states: 

DESCRIPTION YES NO NOTES 

Completeness: Did the offeror 

provide all information/data 

required to render the price as 

complete? X 

The offeror failed to include 

pricing for roof work, the 

Netshelter SX enclosure, test & 

balance (air or CFMs), and training 

and asbuilts 

Price Reasonableness: 

Reasonableness is based on the 

total evaluated price compared to 

historical prices for similar efforts, 

comparison to the Independent 

Government Estimate (IGE), and 

price competition obtained by the 

other offerors’ proposals submitted 

in response to this RFP. Did the 

offeror provide a reasonable price 

that a prudent person would pay in 

a competitive business 

environment? X 

The offeror’s price was [. . .]% 

lower than IGE and [. . . ]% lower 

than the average of the proposed 

Technically Acceptable offeror’s 

[sic]. This price is unreasonably 

low based on the offeror’s technical 

approach. 

Price Realism: Did the offeror 

provide a Realistic price based on 

the items of the demonstration 

project for the work to be 

performed, reflect a clear 

understanding of the requirements, 

and are [sic] consistent with the 

various elements of the offeror’s 

technical proposal? 

(Unrealistically low or high prices X 

The offeror’s material and labor 

cost alone is [. . . ]% less than the 

IGE. The offeror’s average labor 

rate is $[. . .] less than IGE and 

other offers. Based on the TEP, it 

is unrealistic that KWR can 

accomplish the demonstration 

project. 
 8 

may be grounds for eliminating a 

proposal from competition on the 

basis that the offeror does not 

understand the requirement.) 

Id. at 1416. Based on this evaluation, the Air Force determined that KWR’s price 

proposal was incomplete, unreasonable and unrealistic, and its proposal was not further 

considered. Id. at 1415-16. 

Ten offerors were determined to have complete, reasonable, and realistic prices. 

AR 1634. Those offerors’ total evaluated prices were ranked from lowest to highest, and 

their proposals were evaluated for past performance in Step 3. Id. at 1635-36. On July 

28, 2014, at the conclusion of the past performance evaluation, the Air Force made 

awards to Herman, Rore, M&M, and Premier, the four offerors with the lowest total 

evaluated prices that also received a Substantial Confidence Past Performance rating. Id. 

at 1636-37. KWR was notified accordingly and received the requested debriefing. Id. at 

1818-19, 1882-1903. 

The reasons for rejecting KWR’s proposal at the debriefing, however, differed 

from those identified in the SSEB summary, noted above. The debriefing materials stated 

as follows: 

DESCRIPTION YES NO NOTES 

Completeness: Did the offeror 

provide all information/data 

required to render the price as 

complete? X 

The offeror failed to include labor 

pricing for HVAC installation, 

Server Rack installation, and 

incorrectly inputted Elec load 

study in material 

Price Reasonableness: 

Reasonableness is based on the total 

evaluated price compared to 

historical prices for similar efforts, X 

The offeror’s price was [. . .]% 

lower than IGE and [. . .]% lower 

than the average of the proposed 

Technically Acceptable offeror’s 
 9 

comparison to the Independent 

Government Estimate (IGE), and 

price competition obtained by the 

other offerors’ proposals submitted 

in response to this RFP. Did the 

offeror provide a reasonable price 

that a prudent person would pay in a 

competitive business environment? 

[sic]. The offeror’s material and 

labor cost alone is [. . . ]% less 

than the IGE. A prudent person 

would not pay this price knowing 

it has missing items. 

Price Realism: Did the offeror 

provide a Realistic price based on 

the items of the demonstration 

project for the work to be 

performed, reflect a clear 

understanding of the requirements, 

and are [sic] consistent with the 

various elements of the offeror’s 

technical proposal? (Unrealistically 

low or high prices may be grounds 

for eliminating a proposal from 

competition on the basis that the 

offeror does not understand the 

requirement.) X 

The offeror failed to price test & 

balance (air or CFMs), training, 

and asbuilts in accordance with 

their technical approach. The 

offeror did not reflect a clear 

understanding of the requirements.

There is no explanation in the record for these differences. 

D. The Air Force Denies KWR’s Agency Level Protest 

KWR filed a protest with the agency on August 8, 2014, followed by an amended 

protest on August 15, 2014. Id. at 5614-99. In its agency-level protest, KWR alleged 

that its proposal was reasonable and realistic, id. at 5614-15, 5620-21; that its proposal 

was complete, id. at 5616, 5622; that the SSEB neglected to appropriately consider and 

apply its own overarching evaluation criteria, id. at 5617, 5623; and that its submission of 

AF Form 3052 was in compliance with the instructions to offerors, id. at 5625. On 

November 7, 2014, the agency denied KWR’s agency protest. Id. at 5645. 

E. The GAO Dismisses KWR’s Protest 
 10 

On November 17, 2014, KWR filed a protest at the Government Accountability 

Office (GAO) and submitted a supplemental protest on December 29, 2014. Id. at 1904, 

5279. In its protest, KWR alleged that the Air Force made an improper “Best Value” 

determination; failed to make tradeoffs that considered KWR’s past performance; failed 

to adequately document and support its evaluation and award decision; and failed to 

account for publicly available suspect information regarding the awardees. Id. at 1905, 

1907, 1914. Additionally, KWR alleged that is price was complete, reasonable and 

realistic. Id. at 1908, 1911. 

In its supplemental protest, KWR alleged that the Air Force lacked necessary 

evaluation documentation, did not meaningfully consider KWR’s proposal or compare 

KWR’s “superior positioning” to that of other offerors or otherwise follow its own 

evaluation criteria; and based its decision on a flawed competitive range determination. 

Id. at 5791-92. 

Additionally, KWR alleged that the Air Force failed to consider its preAmendment 0009 evaluation of KWR’s past performance; failed to adequately document 

and support its decisions regarding KWR’s labor rates; and circumvented the Small 

Business Act. Id. Finally, KWR alleged that the Air Force acted in bad faith by using 

tradeoffs but then telling KWR that it did not use tradeoffs. Id. at 5792. 

On January 28, 2015, GAO dismissed KWR’s protests. Id. at 5964. The GAO 

explained that because Equa Solutions, Inc. v. United States, No. 14-1214C (Fed. Cl.)—

which involved the same procurement—was pending before the United States Court of 

Federal Claims, the case had to be dismissed. 
 11 

On February 18, 2015, KWR timely filed the pending complaint in this Court. 

Briefing was completed on an expedited basis and oral argument was held on March 20, 

2015. 

II. STANDARD OF REVIEW 

The standard of review in bid protest cases is well-established. The court will 

uphold a procurement decision unless it is found to be “arbitrary, capricious, an abuse of 

discretion, or otherwise not in accordance with law.” Banknote Corp. of Am., Inc. v. 

United States, 365 F.3d 1345, 1350 (Fed. Cir. 2004). To prevail, the protester must 

demonstrate that either (1) the agency’s decision was irrational, id. at 1351, or (2) the 

agency violated a regulation or procedure in a manner that significantly prejudiced the 

protester, Weeks Marine, Inc. v. United States, 575 F.3d 1352, 1358 (Fed. Cir. 2009). 

Where a protester seeks to demonstrate that the procurement decision was irrational, it 

must demonstrate that the agency’s exercise of discretion lacked any “coherent and 

reasonable explanation.” Banknote, 365 F.3d at 1351. This standard is “highly 

deferential,” Weeks Marine, 575 F.3d at 1368-69, and a plaintiff “bears a heavy burden 

of showing that the award decision had no rational basis,” Banknote, 365 F.3d at 1351. 

Where a rational basis exists, the court shall not substitute its judgment for that of the 

agency, “even though it might, as an original proposition, have reached a different 

conclusion as to the proper administration and application of the procurement 

regulations.” Honeywell, Inc. v. United States, 870 F.2d 644, 648 (Fed. Cir. 1989) 

(citing M. Steinthal & Co. v. Seamans, 455 F.2d 1289, 1301 (D.C. Cir. 1971)). 
 12 

Pursuant to this standard, an agency’s procurement decisions are entitled to a 

“presumption of regularity,” and “the agency’s action must be upheld as long as a 

rational basis is articulated and relevant factors are considered.” Emery Worldwide 

Airlines, Inc. v. United States, 264 F.3d 1071, 1085 (Fed. Cir. 2001) (citations omitted); 

Orion Tech., Inc. v. United States, 704 F.3d 1344, 1351 (Fed. Cir. 2013) (“Agencies are 

entitled to a high degree of deference when faced with challenges to procurement 

decisions. A protestor . . . may only prevail when it is clear that the agency’s 

determinations are irrational and unreasonable.” (citations omitted)) (citing R & W 

Flammann GmbH v. United States, 339 F.3d 1320, 1322 (Fed. Cir. 2003); Impresa 

Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1332-33 (Fed. 

Cir. 2001)). 

In reviewing a motion for judgment upon the administrative record pursuant to 

Rule 52.1 of the Rules of the United States Court of Federal Claims, the court must 

decide whether, given all the disputed and undisputed facts, a party is entitled to 

judgment based upon that evidence. A&D Fire Protection, Inc. v. United States, 72 Fed. 

Cl. 126, 131 (2006) (citing Bannum, Inc. v. United States, 404 F.3d 1346, 1356 (Fed. Cir. 

2005)). In sum, in order to set aside a procurement decision, the protestor has the heavy 

burden of establishing that: (1) the procurement official’s decision “had no rational 

basis;” or (2) there has been a “clear and prejudicial violation of applicable statutes or 

regulations.” Centech Group v. United States, 554 F.3d 1029, 1037 (Fed. Cir. 2009) 

(quoting Impresa, 238 F.3d at 1333). 

III. DISCUSSION 
 13 

A. The Agency’s Decision Rejecting KWR’s Price Proposal Is Not 

Supported by the Administrative Record 

The court finds that the dispute in this case turns on whether the Air Force’s 

decision that KWR’s price proposal was incomplete, unreasonable, and unrealistic is 

rationally supported. After reviewing the record and considering the parties’ arguments, 

the court finds that the Air Force’s decision is wrong in several respects and conflicting 

in others. As such, it is impossible for the court to determine the basis of the Air Force’s 

decision to reject KWR’s price proposal. 

First, as noted above, the record demonstrates that the Air Force provided a 

different rationale for rejecting the price proposal before the SSEB than at the debriefing. 

During the evaluation, the SSEB created the following summary: 

DESCRIPTION YES NO NOTES 

Completeness: Did the offeror 

provide all information/data 

required to render the price as 

complete? X 

The offeror failed to include 

pricing for roof work, the 

Netshelter SX enclosure, test & 

balance (air or CFMs), and training 

and asbuilts 

Price Reasonableness: 

Reasonableness is based on the 

total evaluated price compared to 

historical prices for similar efforts, 

comparison to the Independent 

Government Estimate (IGE), and 

price competition obtained by the 

other offerors’ proposals submitted 

in response to this RFP. Did the 

offeror provide a reasonable price 

that a prudent person would pay in 

a competitive business 

environment? X 

The offeror’s price was [. . . ]% 

lower than IGE and [. . . ]% lower 

than the average of the proposed 

Technically Acceptable offeror’s 

[sic]. This price is unreasonably 

low based on the offeror’s technical 

approach. 

Price Realism: Did the offeror 

provide a Realistic price based on 

the items of the demonstration X 

The offeror’s material and labor 

cost alone is [. . .]% less than the 

IGE. The offeror’s average labor 
 14 

project for the work to be 

performed, reflect a clear 

understanding of the requirements, 

and are [sic] consistent with the 

various elements of the offeror’s 

technical proposal? 

(Unrealistically low or high prices 

may be grounds for eliminating a 

proposal from competition on the 

basis that the offeror does not 

understand the requirement.) 

rate is $[. . .] less than IGE and 

other offers. Based on the TEP, it 

is unrealistic that KWR can 

accomplish the demonstration 

project. 

Id. at 1416. However, the rationale provided as part of the debriefing included the 

following summary: 

DESCRIPTION YES NO NOTES 

Completeness: Did the offeror 

provide all information/data 

required to render the price as 

complete? X 

The offeror failed to include labor 

pricing for HVAC installation, 

Server Rack installation, and 

incorrectly inputted Elec load 

study in material 

Price Reasonableness: 

Reasonableness is based on the total 

evaluated price compared to 

historical prices for similar efforts, 

comparison to the Independent 

Government Estimate (IGE), and 

price competition obtained by the 

other offerors’ proposals submitted 

in response to this RFP. Did the 

offeror provide a reasonable price 

that a prudent person would pay in a 

competitive business environment? X 

The offeror’s price was [. . . ]% 

lower than IGE and [. . . ]% lower 

than the average of the proposed 

Technically Acceptable offeror’s 

[sic]. The offeror’s material and 

labor cost alone is [. . .]% less than 

the IGE. A prudent person would 

not pay this price knowing it has 

missing items. 

Price Realism: Did the offeror 

provide a Realistic price based on 

the items of the demonstration 

project for the work to be 

performed, reflect a clear 

understanding of the requirements, 

and are [sic] consistent with the 

various elements of the offeror’s 

technical proposal? (Unrealistically X 

The offeror failed to price test & 

balance (air or CFMs), training, 

and asbuilts in accordance with 

their technical approach. The 

offeror did not reflect a clear 

understanding of the requirements.
 15 

low or high prices may be grounds 

for eliminating a proposal from 

competition on the basis that the 

offeror does not understand the 

requirement.) 

Id. at 1899. 

Based on the evidence in the record, it is not possible to determine whether the Air 

Force’s rationale included all of the stated reasons or whether it was changed after the 

fact. For example, the items that the Air Force found to be missing are different in each 

version of the summary, with no explanation as to why the agency chose to focus on 

different items. This is especially important where one of the original items (roof work) 

has now been conceded by the government to not be missing and another (Netshelter SX 

enclosure) was not required to be its own line item and was not priced separately in the 

proposals of successful offerors. 

Second, it is not clear how the price evaluation completed by the evaluators 

became the rationale stated in the decision, as the single sheet provided in the record 

includes check marks under both “YES” and “NO” for some items, positive and negative 

comments, and appears to have been filled in or supplemented at a later date.2

 Id. at 

5264-66.

 

2

 It is not clear from the record why KWR’s price proposal was apparently re-evaluated on June 

18, 2014 and again on June 20, 2014, as the evaluation sheet indicates. AR 5264-5267. This 

may have been part of the post-amendment re-evaluation, or may have been a separate reevaluation unique to KWR. 
 16 

Third, there is nothing in the record to suggest that the Air Force considered 

KWR’s explanation of the post-amendment reductions in its price. When it submitted its 

post-amendment price reductions, KWR explained its reasoning and methods in a letter 

to the CO, stating: “KWR Construction Inc. appreciates the opportunity to update our 

Price Proposal to reflect current commodity conditions and labor hour estimates. Our 

overhead factors have recently changed due to current volume of work in progress. We 

have lowered our profit margin in order to be as competitive as possible.” AR 780. 

There is no indication that the Air Force considered the provided reasoning when making 

its reasonableness determination. This is especially important considering that, prior to 

the amendment, the Air Force had determined the proposal to be reasonable. An 

examination of the changed costs reveals that, while many prices were altered somewhat, 

the major changes occurred in KWR’s profit and overhead and labor rates for supervisory 

positions, as well as prices for HVAC equipment and electrical load studies. As the 

agency’s analysis focused almost exclusively on a gross percentage difference between 

KWR’s proposal and the IGE, it is not clear to the court what aspects of the proposal 

caused it to be deemed unreasonable.3

Fourth, it is unclear how the Air Force performed the math to arrive at the 

percentages used to determine reasonability. The agency found that KWR’s materials 

and labor “alone” were [. . .]% less than the IGE. However, the price proposal provided a 

 

3

 At oral argument, the government argued that the initial finding of reasonableness was an error 

by the agency. While this may be true, there is no evidence in the record to support such a 

finding. 
 17 

material cost of $[. . .] and a labor cost of $[. . .], for a total material and labor cost of $[. . 

.]. AR 781. The IGE provided a material cost of $[. . .] and a labor cost of $[. . .], for a 

total material and labor cost of $[. . .]. Id. at 2. It is undisputed that KWR’s material and 

labor cost “alone” is therefore not [. . .]% lower than the IGE’s material and labor cost, 

but rather [. . .]% higher.4

In this connection, the Air Force’s method for analyzing KWR’s price proposal to 

the IGE is not clear. It appears that the major deviation in costs from the IGE was the 

APC UPS Upgrade: the IGE priced it at $[. . .] in direct costs alone, id. at 7, while KWR 

priced it at $[. . .] in material costs alone, id. at 781. Especially considering that this 

element’s price provided a significant portion of the agency’s reasoning for finding the 

proposal unreasonable, the lack of a clear explanation of whether KWR’s proposed price 

for the item was reasonable makes it difficult to determine whether the overall 

determination of reasonableness was rational. Further, these missing explanations are 

made more important by the fact that the agency found another offeror’s price proposal to 

be complete, reasonable, and realistic when it was [. . .]% higher than the IGE, [. . .]% 

higher than the average of technically-acceptable offerors, had a material cost that was [. . 

. ]% higher than the IGE, and had a labor cost that was [. . .]% higher than the IGE. Id. at 

 

4

 The government argues that the percentage can be explained by adding in the direct costs, as 

identified on the front page of the evaluation sheet. AR 5264. However, the back page of the 

sheet indicates that there was a difference in “materials costs” that is not supported. Id. at 1187. 

Moreover, the final summary refers to material and labor costs. Id. at 1416. Accordingly, it is 

unclear which one of these three possibilities the Air Force was applying when it made its 

decision to reject KWR’s price proposal. 
 18 

1421-22. There is no explanation as to why prices significantly higher than the IGE were 

acceptable, whereas those lower than the IGE were not. 

Finally, the Air Force may have failed to consider all of the factors required for 

price evaluation in the solicitation. The Air Force was required to consider historical 

prices, the IGE and comparative prices in making its price reasonableness determination. 

Id. at 186. It is unclear whether the agency considered historical prices at all in 

determining the reasonableness of the pricing, as required by the solicitation. While the 

government argued that historical prices were incorporated by reference in the IGE, 

which was based on previous projects and their prices, see id. at 1, historical prices were 

included as a separate evaluation factor and thus should have been separately evaluated 

even if they were used in creating the IGE. 

IV. CONCLUSION 

Based on the facts of this case, the court finds that it must vacate the Air Force’s 

rejection of KWR’s proposal for award consideration, and therefore a remand to the Air 

Force is necessary. Florida Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985). The 

Tucker Act provides this court with “the power to remand appropriate matters to any 

administrative or executive body or official with such direction as it may deem proper 

and just.” 28 U.S.C. § 1491(a)(2). 

Accordingly, plaintiff’s motion for judgment on the administrative record is 

GRANTED-IN-PART and the government’s cross-motion for judgment on the 
 19 

administrative record is DENIED.

5

 The agency’s decision to reject KWR based on its 

price proposal is hereby VACATED and REMANDED to the Air Force for a period of 

14 days, until Monday, April 6, 2015.

6

 On remand, the Air Force must explain its 

rejection of KWR’s price proposal with a reasoned explanation or adopt a different 

decision with a reasoned explanation. Under either approach, the agency should address 

the issues identified above. Pursuant to RCFC 52.2(b), the government shall submit a 

status report on or before the conclusion of the remand period informing the court of the 

status of the remand proceedings. 

IT IS SO ORDERED. 

 

s/Nancy B. Firestone 

NANCY B. FIRESTONE 

Judge 

 

5

 The court need not reach the other arguments raised by plaintiff in its motion for judgment on 

the administrative record because of this decision. Plaintiff additionally filed two motions to 

supplement the administrative record, a motion to strike, a renewed motion for preliminary and 

permanent injunctions, a motion for leave to file a brief on available remedies, and moved for 

discovery in the alternative to its motion for judgment on the administrative record. Based on 

the court’s remand of the agency decision, those motions are DENIED as MOOT. 

6

 As the government has represented that no action will be taken on the pending issuance of task 

orders under this contract until some time after April 9, 2015, the court finds that it is possible to 

fully resolve these issues before that date. Accordingly, the court need not consider the propriety 

of injunctive relief.