CEMP-E/CECW-E
EI 01D010
1 September 1997
CHAPTER 16
16-2. Preparation of Technical and
PROTESTS OR LITIGATION CONCERNING
Cost Analysis by Cost Engineer
THE GOVERNMENT ESTIMATE
a. The cost engineer should prepare a
technical and cost analysis evaluation for
16-1. General
documentation of the contract file. Major factors
in the analysis include:
a. There are two major situations when the cost
engineer may become involved in litigation
(1) The technical analysis will consist of an
concerning the Government estimate.
in-depth, point-by-point response to all issues
raised on the cost estimate by the protestor or
(1) Either a bid protest when bids are
contractor.
opened,
(2) The cost analysis will consist of a review
(2) Or if a proposed change order/
of the Government estimate, including all backup
modification is not accepted by a contractor, and the
and supporting data, and assumptions made which
contractor pursues the dispute.
support the estimate.
b. The procedure to process the issues are the
b. Additional information concerning
same for all types of projects or contracts associated
factors to be considered in the technical and cost
with military, civil works or HTRW programs. When
analysis are presented in chapter 14. Reference is
either of the above occurs, the cost engineer has a
made to FAR sub-part 15.608 for proposal
major role in reviewing the Government estimate and
evaluation.
evaluating the Government's position.
16-3. Review of the Government
c. Bid protests. During the bidding process, and
Estimate
upon receipt of bids, if all bids are sufficiently higher
than the Government estimate, any one of the
proposer/offerers can protest the unreasonableness of
a. Bid protests. If there is a bid protest
the Government estimate by stating it contains errors
concerning the reasonableness of the Government
or omissions; too low and not fair and reasonable. A
estimate, i.e., a bidder is claiming the estimate is
major concern occurs for a bid opening in Civil Works
too low, the cost engineer should conduct an
as the contract cannot be awarded to the low bidder if
independent review of the Government estimate.
the low bid exceeds the Government estimate by 25
percent; and 15 percent for military programs. In such
(1) The cost engineer should review the
a case, a bid protest will delay all further contractual
estimate to be sure that it does not contain
action to award until either the bid protester
mistakes. This evaluation must be completed as
withdraws the protest; the Government estimate is
soon as possible to provide timely advice to the
revised; or a determination is made through the
District staff to preclude delay in award. If the
judicial process.
Government estimate is revised, and the revised
estimate brings an offeror's price within the range
d. Contract modifications/change orders.
of a fair and reasonable price, award will be made
During the on-going construction, changes will occur,
provided funds are available. The revised estimate
including overruns of quantities, and disagreements
requires the same approval authority as the original
may occur between the contractor and the Govern-
Government estimate.
ment. If a dispute does arise, it generally concerns a
disagreement between what the government considers
(2) When the Government estimate is
a fair and reasonable cost as compared to the proposal
reviewed and has been determined to be fair and
offered by the contractor. In the event agreement can
reasonable for the intended scope of work, unless
be reached between the contractor and the
the protestor withdraws the bid protest, the usual
Government, a dispute, or claim may result.
procedure will require a Contracting Officers
16-1
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