Protest Spotlight

(This regular feature highlights protests decided by the Government Accountability Office.)

Agency: Naval Sea Systems Command

Awardee: Lockheed Martin

Protester: General Dynamics

What GAO found: General Dynamics protested the award of a contract for the Navy's surface electronic warfare improvement program block 1B3 full-rate production requirement to Lockheed, arguing the agency "conducted an unreasonable cost realism analysis."

GD contended the Navy wrongly assumed that it had proposed uncompensated overtime and, as a result, incorrectly adjusted the company's cost proposal upward. The Navy evaluated GD's cost at $24.96 million, about $10,000 higher than Lockheed's $24.95 million. The procurement was evaluated using the lowest-price, technically acceptable approach.

GAO backed GD, recommending the Navy perform a "reasonable cost realism evaluation" of the company's proposal. Additionally, the audit agency recommended the protesters be reimbursed the costs of pursuing the protest.

The decision: http://www.gao.gov/assets/680/673410.pdf