DECISION DENYING CLAIM BY JAMES R. CROOKS FOR $1,115 REPRESENTING
REIMBURSEMENT OF REAL ESTATE EXPENSES INCURRED IN THE SALE OF A HOUSE
INCIDENT TO A CHANGE OF OFFICIAL STATION.
SECTION 4.1D OF OFFICE OF MANAGEMENT AND BUDGET CIR. NO. A-56 DOES
NOT AUTHORIZE REIMBURSEMENT FOR BROKERAGE FEES AND A COST OF CREDIT
REPORT ON THE BUYER INCIDENT TO THE SALE OF A HOUSE WHICH WAS NOT THE
EMPLOYEE'S RESIDENCE AT THE TIME HE WAS FIRST DEFINITELY INFORMED BY
COMPETENT AUTHORITY THAT HE IS TO BE TRANSFERRED TO THE NEW OFFICIAL
STATION.
TO MR. ARNE A. NIEMI:
THIS REFERS TO YOUR LETTER DATED MARCH 17, 1971, FORWARDED HERE BY
LETTER DATED APRIL 2, 1971, OF HEADQUARTERS DEFENSE SUPPLY AGENCY,
REQUESTING AN ADVANCE DECISION AS TO THE PROPRIETY OF PAYMENT OF A
VOUCHER IN THE AMOUNT OF $1,115, IN FAVOR OF JAMES R. CROOKS,
REPRESENTING REIMBURSEMENT OF REAL ESTATE EXPENSES INCURRED IN THE SALE
OF A HOUSE INCIDENT TO A CHANGE OF OFFICIAL STATION FROM COLUMBUS, OHIO,
TO BATTLE CREEK, MICHIGAN.
IT IS INDICATED BY THE RECORDS THAT MR. CROOKS, A RESIDENT OF
MICHIGAN, WAS EMPLOYED IN SEPTEMBER 1969 AND HIS FIRST OFFICIAL STATION
WAS COLUMBUS, OHIO. DUE TO ILLNESS OF HIS DAUGHTER, HIS WIFE AND FAMILY
REMAINED IN MICHIGAN, AND THEREAFTER HE SOUGHT EMPLOYMENT IN MICHIGAN IN
ORDER TO BE WITH HIS FAMILY. BY TRAVEL ORDER NO. DL 19-71 DATED JULY 6,
1970, HIS TRANSFER WAS AUTHORIZED FROM COLUMBUS, OHIO, TO BATTLE CREEK,
MICHIGAN, AND IN ADDITION TO OTHER EXPENSES, REIMBURSEMENT OF REAL
ESTATE EXPENSES WAS AUTHORIZED. HIS CLAIM FOR BROKERAGE FEES AND COST
OF CREDIT REPORT ON THE BUYER INCIDENT TO THE SALE OF HIS HOUSE IN
MUSKEGON, MICHIGAN, WHICH YOU SAY HE HAD RENTED WHILE HE WAS EMPLOYED IN
COLUMBUS, OHIO, WAS DENIED. MR. CROOKS HAS REQUESTED RECONSIDERATION OF
HIS CLAIM ON THE GROUND THAT NO ADDITIONAL COST TO THE GOVERNMENT WAS
INCURRED AND THE REIMBURSEMENT WAS AUTHORIZED IN HIS TRANSFER ORDER.
SECTION 4.1 OF OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO. A-56,
REVISED JUNE 26, 1969, ISSUED IN IMPLEMENTATION OF THE ADMINISTRATIVE
EXPENSES ACT OF 1946, AS AMENDED BY THE ACT OF JULY 21, 1966, PUBLIC LAW
89-516, 80 STAT. 323, PROVIDES IN PART AS FOLLOWS:
" *** TO THE EXTENT ALLOWABLE UNDER THIS PROVISION, THE GOVERNMENT
WILL REIMBURSE AN EMPLOYEE FOR EXPENSES REQUIRED TO BE PAID BY HIM IN
CONNECTION WITH THE SALE OF ONE RESIDENCE AT HIS OLD OFFICIAL STATION;
PURCHASE (INCLUDING CONSTRUCTION) OF ONE DWELLING AT HIS NEW OFFICIAL
STATION; OR THE SETTLEMENT OF AN UNEXPIRED LEASE INVOLVING HIS
RESIDENCE OR A LOT ON WHICH A HOUSE TRAILER USED AS HIS RESIDENCE WAS
LOCATED AT THE OLD OFFICIAL STATION; PROVIDED THAT:
"D. THE DWELLING FOR WHICH REIMBURSEMENT OF SELLING EXPENSES IS
CLAIMED WAS THE EMPLOYEE'S RESIDENCE AT THE TIME HE WAS FIRST DEFINITELY
INFORMED BY COMPETENT AUTHORITY THAT HE IS TO BE TRANSFERRED TO THE NEW
OFFICIAL STATION."
THE LANGUAGE OF THE REGULATION IS CLEAR AND UNAMBIGUOUS AND PERMITS
REIMBURSEMENT OF THE EXPENSES OF THE SALE OF A DWELLING AT THE OLD
OFFICIAL STATION WHICH WAS THE EMPLOYEE'S ACTUAL RESIDENCE AT THE TIME
OF HIS OFFICIAL TRANSFER. SEE 46 COMP. GEN. 703 (1967). AT THE TIME OF
HIS TRANSFER, MR. CROOKS WAS NOT LIVING IN THE HOUSE IN MUSKEGON,
MICHIGAN, WHICH WAS APPARENTLY RENTED, BUT WAS ACTUALLY RESIDING IN
COLUMBUS, OHIO, WHILE HIS FAMILY REMAINED IN MICHIGAN.
WHILE THE TRANSFER ORDER AUTHORIZED REIMBURSEMENT OF REAL ESTATE
EXPENSES, WE NOTE SUCH AUTHORIZATION WAS A GENERAL AUTHORIZATION AND MAY
BE PRESUMED TO HAVE BEEN GIVEN UPON THE BASIS THAT REIMBURSEMENT OF ANY
SUCH EXPENSES COULD ONLY BE MADE IN ACCORDANCE WITH THE PROVISIONS OF
CIRCULAR NO. A-56. EVEN IF SUCH AUTHORIZATION HAD BEEN MORE SPECIFIC,
IT COULD NOT HAVE BEEN REGARDED AS PROPER. THE PROVISIONS OF THE
CIRCULAR ARE STATUTORY IN NATURE AND NEITHER THIS OFFICE NOR ANY
EXECUTIVE AGENCY MAY WAIVE OR EXTEND THEM. ALSO, IT IS WELL SETTLED
THAT THE UNITED STATES IS NOT BOUND BY UNAUTHORIZED ACTS OF ITS OFFICERS
AND EMPLOYEES. WILBER NATIONAL BANK V UNITED STATES, 294 U.S. 120
(1935).
ACCORDINGLY, THE VOUCHER WHICH IS RETURNED HEREWITH MAY NOT BE PAID.
B-172615, MAY 25, 1971
DEBT DUE THE UNITED STATES - REQUEST FOR WAIVER
DECISION DENYING REQUEST FOR WAIVER OF $375 DEBT DUE THE U.S.
INCIDENT TO ERRONEOUS DEDUCTIONS OF PAY WHILE CLAIMANT WAS ON ACTIVE
DUTY U.S. NAVY.
THE WAIVER STATUTE CONTAINED IN 5 U.S.C. 5584 REFERS TO CIVILIAN
EMPLOYEES OF THE EXECUTIVE AGENCIES OF THE GOVERNMENT AND THE
IMPLEMENTING REGULATIONS CONTAINED IN CHAPTER 1 OF TITLE 4, CODE OF
FEDERAL REGULATIONS PROVIDES THAT 5 U.S.C. 5584 DOES NOT APPLY TO
MEMBERS OF THE UNIFORMED SERVICE. THEREFORE WAIVER IS DENIED AND THE
DEBT SHOULD BE LIQUIDATED AS SOON AS POSSIBLE.
TO MR. CHARLES A. PARDEE, JR.
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 7, 1970,
RELATIVE TO YOUR REPORTED INDEBTEDNESS TO THE UNITED STATES IN THE
AMOUNT OF $375, WHILE ON ACTIVE DUTY AS FTG3, UNITED STATES NAVY.
BY LETTER DATED DECEMBER 3, 1968, YOU WERE ADVISED BY THE NAVY
FINANCE CENTER, CLEVELAND, OHIO, THAT AN AUDIT WAS MADE OF YOUR PAY
ACCOUNT PERTAINING TO YOUR SERVICE IN THE NAVY. THE AUDIT DISCLOSED
THAT MONTHLY DEDUCTIONS SHOULD HAVE BEEN MADE IN THE AMOUNT OF $40.50
FOR THE PURCHASE OF A U.S. SAVINGS NOTE (FREEDOM BOND), FACE VALUE $50,
AND $75 FOR THE PURCHASE OF TWO U.S. SAVINGS BOND, FACE VALUE $50 EACH.
HOWEVER, THE PAY RECORDS SHOWED DEDUCTIONS WERE MADE EACH MONTH FOR ONE
FREEDOM BOND AT $40.50 AND ONE SAVINGS BOND AT $37.50 DURING THE
10-MONTH PERIOD FROM SEPTEMBER 1967 THROUGH JUNE 1968. AS A RESULT, YOU
WERE OVERPAID $37.50 PER MONTH OR A TOTAL OF $375.00.
REQUESTS WERE MADE FOR YOU TO LIQUIDATE YOUR INDEBTEDNESS WITHIN A
REASONABLE TIME. HOWEVER, AT THAT TIME, YOU SAID YOU WERE GOING TO
COLLEGE AND WOULD NOT BE ABLE TO MAKE ANY REPAYMENT UNTIL YOUR
GRADUATION, WHICH YOU SAID WOULD BE IN JUNE 1971. THE INDEBTEDNESS WAS
LATER REFERRED TO OUR OFFICE FOR COLLECTION ACTION.
IN RESPONSE TO AN INQUIRY FROM OUR CLAIMS DIVISION DATED JANUARY 29,
1970, YOU REPLIED IN LETTER DATED FEBRUARY 13, 1970, THAT YOU WOULD BE
FINANCIALLY ABLE TO COMMENCE REPAYMENT OF THE DEBT ON SEPTEMBER 15,
1970. HOWEVER, IN A LETTER DATED JUNE 5, 1970, YOU ENCLOSED A COPY OF AN
ARTICLE APPEARING IN THE MAY 1, 1970, ISSUE OF THE GOVERNMENT STANDARD,
WHICH REPORTED THAT UNDER THE PROVISIONS OF PUBLIC LAW 90-616 (APPROVED
OCTOBER 21, 1968, 82 STAT. 1212), FEDERAL EMPLOYEES WERE NO LONGER
REQUIRED TO RETURN MONEY ERRONEOUSLY PAID THEM BY THE GOVERNMENT, AND
REQUESTED THE COLLECTION OF YOUR INDEBTEDNESS BE WAIVED BY THE NAVY
DEPARTMENT.
BY LETTER DATED SEPTEMBER 22, 1970, YOU WERE ADVISED THAT THE WAIVER
STATUTE TO WHICH YOU REFERRED, PRESENTLY CONTAINED IN 5 UNITED STATES
CODE 5584, AUTHORIZES THE WAIVER OF CLAIMS OF THE UNITED STATES ARISING
OUT OF ERRONEOUS PAYMENTS TO CIVILIAN EMPLOYEES OF THE EXECUTIVE
AGENCIES OF THE GOVERNMENT ON OR AFTER JULY 1, 1960. YOU WERE ADVISED
FURTHER THAT, SINCE YOU HAD NOT BEEN EMPLOYED IN A CIVILIAN CAPACITY AT
THE TIME THE OVERPAYMENT IN QUESTION OCCURRED, YOUR INDEBTEDNESS MAY NOT
BE WAIVED UNDER THAT STATUTE.
IN YOUR LETTER DATED NOVEMBER 7, 1970, YOU ACKNOWLEDGE THAT YOU DO
NOT FIT INTO THE TECHNICAL DEFINITION OF THE TERM "EMPLOYEE" AS USED IN
5 U.S.C. 5584. HOWEVER, YOU CLAIM RELIEF UNDER THE SPIRIT OF THE LAW OF
THOSE PROVISIONS, IN THAT YOU WERE, IN EFFECT, AN EMPLOYEE OF THE
FEDERAL GOVERNMENT AT THE TIME OF THE ALLEGED OVERPAYMENTS. YOU STATED
FURTHER THAT WHILE IN THE SERVICE, THE NAVY FINANCE OFFICER HAD IGNORED
YOUR SUGGESTION THAT YOUR PAYMENTS WERE TOO HIGH AND THAT YOU ARE NOW
NOT COMPLETELY SURE YOU WERE EVER OVERPAID.
SECTION 5584(A) TITLE 5, UNITED STATES CODE, PROVIDES IN PERTINENT
PART THAT A CLAIM OF THE UNITED STATES AGAINST A PERSON ARISING OUT OF
AN ERRONEOUS PAYMENT OF PAY, ON OR AFTER JULY 1, 1960, TO AN EMPLOYEE OF
AN EXECUTIVE AGENCY THE COLLECTION OF WHICH WOULD BE AGAINST EQUITY AND
GOOD CONSCIENCE AND NOT IN THE BEST INTEREST OF THE UNITED STATES, MAY
BE WAIVED IN WHOLE OR IN PART, UNDER THE CONDITIONS THEREIN SPECIFIED
AND IN ACCORDANCE WITH STANDARDS WHICH THE COMPTROLLER GENERAL MAY
PRESCRIBE.
IMPLEMENTING REGULATIONS ARE PRESENTLY CONTAINED IN CHAPTER 1 OF
TITLE 4 OF THE CODE OF FEDERAL REGULATIONS. SECTION 91.3(A) THEREOF
PROVIDES THAT THE PROVISIONS OF PUBLIC LAW 90-616, 82 STAT. 1212 (5
U.S.C. 5584), DO NOT APPLY TO MEMBERS OF THE UNIFORMED SERVICES AS
DEFINED IN 5 U.S.C. 2101(3), WHICH DEFINITION INCLUDES THE DEPARTMENT
OF THE NAVY. SECTION 101(23) OF TITLE 37, UNITED STATES CODE, DEFINES
THE TERM "MEMBER" AS A PERSON APPOINTED, ENLISTED IN OR CONSCRIPTED INTO
A UNIFORMED SERVICE.
WHILE YOU SAY IN YOUR RECENT LETTER THAT YOU ARE NOT COMPLETELY SURE
THAT YOU WERE OVERPAID, YOU INDICATE THAT YOU HAD SUGGESTED TO YOUR
FINANCE OFFICER THAT YOUR PAYMENTS WERE TOO HIGH. FURTHERMORE, WE MUST
RELY ON THE INFORMATION FURNISHED BY THE NAVY FINANCE CENTER THAT IT HAD
DETERMINED ON THE BASIS OF AN AUDIT OF YOUR PAY ACCOUNT THAT THE
OVERPAYMENT OF $375 WAS MADE IN THE MATTER REPORTED.
IT IS THEREFORE REQUESTED THAT A CHECK OR MONEY ORDER IN THE AMOUNT
OF $375, PAYABLE TO THE "U.S. GENERAL ACCOUNTING OFFICE" BE FORWARDED
IN THE ENCLOSED SELF-ADDRESSED ENVELOPE. IF PAYMENT IN FULL CANNOT BE
MADE, AN INITIAL PAYMENT MAY BE MADE AND A PLAN SUBMITTED FOR REPAYMENT
OF THE BALANCE WITHIN A REASONABLE TIME.
B-171857(1), MAY 24, 1971
BID PROTEST - BIDDER RESPONSIBILITY - CONFLICT OF INTEREST
DENYING PROTEST OF CAPCOMP, INC., AGAINST THE AWARD OF A CONTRACT TO
ITT DATA SERVICES UNDER AN RFP ISSUED BY THE AGRICULTURE STABILIZATION
AND CONSERVATION SERVICE FOR CONSULTATION ON UTILIZING TECHNIQUES OF
ADVANCED GENERATION DIGITAL COMPUTER TECHNOLOGY.
AN RFP PROHIBITING AWARD TO ANY FIRM ENGAGED IN THE MANUFACTURE OF
AUTOMATIC DATA PROCESSING EQUIPMENT DOES NOT PREVENT AWARD TO ITT ON THE
BASIS OF ITS MANUFACTURE OF DATA COMMUNICATIONS EQUIPMENT, THE AGENCY
HAVING CONSIDERED THAT THE MANUFACTURE OF SUCH PERIPHERAL EQUIPMENT
CONSTITUTED AN INSUFFICIENT THREAT OF CONFLICT OF INTEREST.
TO CAPCOMP, INCORPORATED:
REFERENCE IS MADE TO YOUR LETTERS DATED FEBRUARY 3, 1971, AND APRIL
1, 1971, WITH ENCLOSURES, PROTESTING THE AWARD OF A CONTRACT TO ITT DATA
SERVICES (ITT) UNDER REQUEST FOR PROPOSALS (RFP) NO. ASCS-34-71DC,
ISSUED ON OCTOBER 13, 1970, BY THE AGRICULTURAL STABILIZATION AND
CONSERVATION SERVICE (ASCS), UNITED STATES DEPARTMENT OF AGRICULTURE.
THE SUBJECT RFP SOLICITED DETAILED PROPOSALS FOR PROVIDING DESIGNATED
ASCS OFFICIALS WITH ADVICE AND CONSULTING SERVICES IN COOPERATION WITH
THE ACCOUNTING, BUDGET, AND REPORTING TASK FORCE FOR THE DEVELOPMENT OF
A CONCEPTUAL PLAN FOR THE FUTURE FINANCIAL OPERATION OF ASCS AND THE
COMMODITY CREDIT CORPORATION AS A SEGMENT OF A TOTAL AGENCY OPERATING
SYSTEM, UTILIZING TECHNIQUES OF ADVANCED GENERATION DIGITAL COMPUTER
TECHNOLOGY. THE RFP LISTED A NUMBER OF SPECIFIC AREAS FOR CONSULTATION
DEALING WITH ACCOUNTING, BUDGETING, REPORTING AND TRAINING.
THE SOLICITATION PROVIDED FOR A TWO-PHASE EVALUATION OF PROPOSALS
SUBMITTED, WITH SPECIFIED POINT VALUES ASSIGNED TO THE VARIOUS SELECTION
CRITERIA. ONLY THOSE PROPOSALS WHICH SCORED AT LEAST 80 PERCENT OF A
POSSIBLE 100 PERCENT IN PHASE ONE WERE MADE ELIGIBLE FOR PHASE TWO
EVALUATION AND ONLY THOSE WHOSE PROPOSALS SCORED 80 PERCENT IN PHASE TWO
WERE MADE ELIGIBLE FOR NEGOTIATION AND AWARD. IN ADDITION, THE "NOTICE
TO PROSPECTIVE OFFERORS" WHICH WAS INCORPORATED INTO THE SUBJECT RFP
PROVIDED THAT "OFFERS WILL NOT BE ACCEPTED FROM FIRMS ENGAGED IN THE
MANUFACTURE OF AUTOMATIC DATA PROCESSING EQUIPMENT OR FROM SUBSIDIARIES,
AFFILIATES AND AGENTS OF SUCH FIRMS." PROSPECTIVE OFFERORS WERE ALSO
ADVISED THAT A COST-PLUS-FIXED-FEE CONTRACT WAS ANTICIPATED.
TWELVE OFFERS WERE RECEIVED AND PHASE ONE EVALUATION COMMENCED IN
EARLY NOVEMBER 1970 BY A SELECTION AND EVALUATING BOARD, CONSISTING OF
FOUR ASCS OFFICIALS REPRESENTING THE AREAS OF INTEREST INVOLVED IN THE
SUBJECT RFP, AND A REPRESENTATIVE OF THE OFFICE OF BUDGET AND FINANCE OF
THE DEPARTMENT OF AGRICULTURE. FOUR OFFERS INCLUDING YOUR FIRM
QUALIFIED FOR PHASE TWO EVALUATION BY RECEIVING SCORES OF 80 OR MORE ON
PHASE ONE. OF THESE FOUR, ONLY ITT RECEIVED A QUALIFYING SCORE OF 80
PERCENT IN THE SECOND PHASE, THUS BECOMING THE ONLY OFFEROR ELIGIBLE FOR
NEGOTIATION AND AWARD. THE SUBJECT CONTRACT WAS AWARDED ON DECEMBER 7,
1970, TO ITT, WHO THEN COMMENCED PERFORMANCE.
AN ANALYSIS OF THE CORRESPONDENCE INDICATES THAT THE BASES FOR
PROTEST ARE ESSENTIALLY THAT: (1) THE CONTRACTOR, ITT DATA SERVICES, A
SUBSIDIARY OF INTERNATIONAL TELEPHONE AND TELEGRAPH CORPORATION (ITT
CORP.), IS INELIGIBLE TO RECEIVE AWARD BECAUSE THE PARENT COMPANY IS
HEAVILY ENGAGED IN THE MANUFACTURE OF AUTOMATIC DATA PROCESSING
EQUIPMENT AND THE RFP PROHIBITS AWARD TO ANY FIRM ENGAGED IN SUCH
MANUFACTURE, AND (2) THE POINT EVALUATION OF PROPOSALS WAS ERRONEOUSLY
UTILIZED AS AN ABSOLUTE FOR DETERMINING ELIGIBILITY WHEREAS POINT
EVALUATION SHOULD HAVE ONLY BEEN UTILIZED AS A BASIS FOR RANKING
ELIGIBLE CONTRACTORS.
YOUR FIRM BASES ITS CONTENTION THAT ITT IS INELIGIBLE FOR AWARD UNDER
THE PROVISION ON EVIDENCE FROM SEVERAL TRADE PUBLICATION ARTICLES AND
FROM PORTIONS OF ITT CORP.'S LATEST ANNUAL REPORT, WHICH INDICATE THAT
EITHER ITT OR ITT CORP. IS INVOLVED IN THE MANUFACTURE OF VARIOUS TYPES
OF DATA EQUIPMENT. ON THE OTHER HAND, ASCS AND ITT CONTEND THAT THE
EQUIPMENT MANUFACTURED BY ITT SHOULD BE CLASSIFIED AS DATA
COMMUNICATIONS EQUIPMENT WHICH IS NOT WITHIN THE PROHIBITION AND WOULD
RESULT IN NO CONFLICT OF INTEREST, SINCE THE EQUIPMENT IS NOT OF THE
TYPE ASCS WOULD ULTIMATELY USE WITH THE PROPOSED ACCOUNTING SYSTEM.
YOUR FIRM CONTENDS THAT BOTH DATA PROCESSING AND DATA COMMUNICATIONS
EQUIPMENT WOULD BE UTILIZED IN THE PROJECTED SYSTEM THUS CREATING A
SITUATION WHEREBY THE MANUFACTURE OF EITHER CLASS OF EQUIPMENT WOULD
VIOLATE EITHER THE LANGUAGE OR THE SPIRIT OF THE PROHIBITION.
THE RECORD INDICATES THAT ITT'S ELIGIBILITY UNDER THE SUBJECT RFP WAS
EXTENSIVELY REVIEWED AND DISCUSSED BY THE SELECTION AND EVALUATING BOARD
WHICH CONCLUDED THAT THE INFORMATION FURNISHED BY ITT PROVIDED AN
ADEQUATE BASIS FOR DETERMINING THAT THE FIRM WAS ELIGIBLE UNDER THE
QUALIFICATION LANGUAGE. WHETHER ITT HAS DEMONSTRATED COMPLIANCE WITH
THE QUALIFICATION LANGUAGE OR WHETHER THEY HAVE THE POTENTIAL TO PERFORM
THE CONSULTING SERVICES IN AN OBJECTIVE MANNER DEPENDS ON THE
DEFINITIONS OF THE TERMS "DATA PROCESSING EQUIPMENT" AND "DATA
COMMUNICATIONS EQUIPMENT" AND THE INTER-RELATIONSHIP BETWEEN THE USES OF
THESE TWO TYPES OF EQUIPMENT.
YOUR FIRM FURTHER ALLEGES THAT EVEN THOUGH ITT MAY NOT MANUFACTURE
DATA PROCESSING EQUIPMENT PER SE THE STATED PURPOSE OF THE PROJECT
CONTEMPLATED BY THE SUBJECT RFP MUST ENCOMPASS THE USE OF DATA
COMMUNICATIONS EQUIPMENT, WHICH ITT CORP. ADMITTEDLY DOES MANUFACTURE.
HOWEVER, WE FEEL THAT IF THE AGENCY DETERMINED THAT THE MANUFACTURE OF
SUCH PERIPHERAL EQUIPMENT CONSTITUTED A SUFFICIENT THREAT OF A CONFLICT
OF INTEREST ON THE PART OF THE PROSPECTIVE CONTRACTOR, THE PROHIBITION
IN THE RFP WOULD HAVE SPECIFICALLY MENTIONED DATA COMMUNICATIONS
EQUIPMENT.
IN VIEW OF THE FACT THAT THE RECORD INDICATES THAT ITT'S PERFORMANCE
OF THE SUBJECT CONTRACT WILL NOT DIRECTLY INVOLVE IT IN DRAWING OF
SPECIFICATIONS FOR EQUIPMENT WHICH THE GOVERNMENT MAY EVENTUALLY
PROCURE, WE MUST CONCLUDE THAT THE QUESTION OF ITT'S ELIGIBILITY UNDER
THE SUBJECT RFP IS A MATTER OF JUDGMENT WITHIN THE COGNIZANCE OF THE
PROCUREMENT AGENCY. CF. 48 COMP. GEN. 702, 706 (1969). WE WILL NOT
SUBSTITUTE OUR JUDGMENT ON SUCH A MATTER IN THE ABSENCE OF CONVINCING
EVIDENCE OF UNREASONABLENESS OR FAVORITISM IN THE AGENCY DETERMINATION.
YOU ALSO CONTEND THAT THE USE OF A PREDETERMINED MINIMUM ACCEPTABLE
EVALUATION SCORE IN DECIDING ELIGIBILITY FOR THE CONDUCT OF NEGOTIATIONS
WAS ERRONEOUS. YOUR FIRM IN EFFECT ALLEGES HERE THAT DISCUSSIONS WERE
NOT CONDUCTED WITH ALL RESPONSIBLE OFFERORS WHO SUBMITTED PROPOSALS
WITHIN A COMPETITIVE RANGE. ONLY ITT ACHIEVED A SCORE OF 80 PERCENT, OR
MORE, ON PHASE TWO, RESULTING IN THE CONDUCT OF NEGOTIATIONS EXCLUSIVELY
WITH ITT. SINCE YOUR PROPOSAL DID NOT ACHIEVE THE PREDETERMINED MINIMUM
ACCEPTABLE SCORE, IT WAS CONSIDERED OUTSIDE THE "COMPETITIVE RANGE." FOR
THAT REASON YOU WERE NOT GIVEN AN OPPORTUNITY TO NEGOTIATE. WE HAVE
HELD THAT THE COMPETITIVE RANGE SHOULD BE DECIDED ON THE BASIS OF THE
ARRAY OF SCORES ACTUALLY OBTAINED BY THE OFFERS, NOT ON A PREDETERMINED
ABSOLUTE SCORE. SEE OUR LETTER OF TODAY TO THE SECRETARY OF
AGRICULTURE, COPY ENCLOSED. HOWEVER, IN VIEW OF THE SCORES ACTUALLY
ACHIEVED, 85 FOR ITT AND 70 FOR CAPCOMP, AND HAVING REGARD FOR THE
DISCRETION AFFORDED THE CONTRACTING ACTIVITY IN SUCH MATTERS, WE CANNOT
CONCLUDE THAT THE DECISION LIMITING FIRMS ELIGIBLE FOR NEGOTIATION AFTER
PHASE TWO TO ITT WAS SO DEFICIENT AS TO JUSTIFY CANCELLATION OF THE
CONTRACT AWARDED UNDER THE SUBJECT RFP.
ACCORDINGLY, YOUR PROTEST MUST BE DENIED.
B-171857(2), MAY 24, 1971
BID PROTEST - COMPETITIVE RANGE - CUT OFF SCORE
IN THE MATTER OF THE PROTEST OF CAPCOMP, INC., AGAINST THE AWARD OF A
CONTRACT UNDER AN RFP ISSUED FOR COMPUTER TECHNOLOGY TECHNIQUES, THE
COMP. GEN. ADVISES THAT ESTABLISHING A CUT-OFF SCORE OF 80% IN PHASE TWO
OF THE EVALUATION PROCEDURE AS AN ABSOLUTE CRITERION OF AN ACCEPTABLE
PROPOSAL CONTRAVENES POLICY THAT THOSE OFFERS WITHIN THE COMPETITIVE
RANGE MUST BE CONSIDERED ON THE BASIS OF THE ACTUAL ARRAY OF SCORES
RECEIVED ALLOWING FOR MODIFICATION OF BORDERLINE PROPOSALS.
TO MR. SECRETARY:
REFERENCE IS MADE TO A LETTER DATED MARCH 12, 1971, FROM THE ACTING
DIRECTOR, OFFICE OF PLANT AND OPERATIONS, OFFICE OF THE SECRETARY,
UNITED STATES DEPARTMENT OF AGRICULTURE, FURNISHING A REPORT IN RESPONSE
TO THE PROTEST OF CAPCOMP, INCORPORATED (CAPCOMP), AGAINST THE AWARD OF
A CONTRACT TO ANOTHER FIRM UNDER REQUEST FOR PROPOSALS (RFP) NO.
ASCS-34-71DC (NEG), ISSUED BY THE AGRICULTURAL STABILIZATION AND
CONSERVATION SERVICE, UNITED STATES DEPARTMENT OF AGRICULTURE.
WHILE WE HAVE DEFERRED TO THE JUDGMENT OF THE SELECTION AND
EVALUATING BOARD IN REGARD TO THE QUALIFICATION OF ITT DATA SERVICES
UNDER THE SUBJECT RFP, WE BELIEVE THE SECOND PORTION OF THE PROTEST
MERITS FURTHER DISCUSSION.
AS INDICATED IN OUR DECISION OF TODAY, COPY ENCLOSED, IT APPEARS THAT
THE SELECTION AND EVALUATING BOARD CONCLUDED THAT CAPCOMP WAS NOT
ENTITLED TO A NEGOTIATION OPPORTUNITY BECAUSE ITS PROPOSAL FAILED TO
ATTAIN THE 80 PERCENT SCORE IN PHASE TWO OF THE EVALUATION PROCEDURE
PREDETERMINED AS AN ABSOLUTE CRITERION FOR AN ACCEPTABLE PROPOSAL, AND
THEREFORE WAS NOT CONSIDERED TO BE WITHIN A COMPETITIVE RANGE. WE THINK
IT WAS REASONABLE ON THE BASIS OF SCORES ACTUALLY ACHIEVED TO DECIDE
THAT CAPCOMP'S PROPOSAL WAS NOT WITHIN A COMPETITIVE RANGE OF THE
ACCEPTABLE PROPOSAL. HOWEVER, IT IS OUR POSITION THAT THOSE OFFERS
WITHIN THE COMPETITIVE RANGE MUST BE DECIDED ON THE BASIS OF THE ACTUAL
ARRAY OF SCORES ACHIEVED AND NOT ON A PREDETERMINED SCORE FOR
ACCEPTABILITY. SEE B-169645(1), JULY 24, 1970 (50 COMP. GEN. ___ ). IT
MUST BE BORNE IN MIND THAT THE PRIMARY CONSIDERATION IN NEGOTIATED
PROCUREMENTS IS DISCUSSIONS WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE
AS DETERMINED BY THE RELATIVE MERITS OF THE PROPOSALS AND BORDERLINE
PROPOSALS SHOULD NOT BE AUTOMATICALLY EXCLUDED FROM CONSIDERATION IF
THEY ARE REASONABLY SUSCEPTIBLE TO BEING MADE ACCEPTABLE BY ADDITIONAL
OR CLARIFYING INFORMATION.
WE ALSO NOTE THAT COST WAS NOT UTILIZED AS A CRITERION IN THE
TWO-STEP EVALUATION PROCESS. IN THIS REGARD, OUR OFFICE HAS HELD THAT
IN COST-TYPE PROCUREMENTS, THE COSTS PROPOSED BY THE OFFEROR ARE ONLY
ESTIMATES AND FOR THIS REASON SUCH PROPOSALS SHOULD NOT BE EVALUATED
STRICTLY ON A PRICE BASIS BUT THAT, NEVERTHELESS, PRICE SHOULD BE
CONSIDERED IN THE EVALUATION OF PROPOSALS. B-171663, DATED APRIL 19,
1971 (50 COMP. GEN. ___ ).
WE HOPE THAT IN FUTURE PROCUREMENTS OF THIS TYPE CLOSER ATTENTION
WILL BE PAID TO THE SPIRIT AND RATIONALE BEHIND THE APPLICABLE
REGULATIONS AND THAT THE EVALUATION PROCEDURE BASED ON A PREDETERMINED
SCORE FOR ACCEPTABILITY WILL NO LONGER BE UTILIZED.
THE DOCUMENTS TRANSMITTED WITH THE LETTER OF MARCH 12 ARE RETURNED.
B-172206, MAY 24, 1971
CIVILIAN EMPLOYEES - PER DIEM - RATE LESS THAN $25
AUTHORIZING PAYMENT OF PER DIEM AT $25 PER DAY RATHER THAN AT $20
ALLOWED BY TRAVEL ORDERS OF ERNEST O. ELLIS AND GORDON O. SIEKER,
EMPLOYEES OF THE DSA INCIDENT TO ATTENDING A TRAINING SEMINAR AT THE
ROCK ISLAND ARSENAL, ROCK ISLAND, ILLINOIS.
PARAGRAPH C8101 OF THE JTR IN EFFECT AT THE TIME OF TRAVEL AUTHORIZED
A PER DIEM OF $25; THE REGULATIONS PROVIDING FOR PAYMENT OF PER DIEM OF
LESS THAN THAT AMOUNT CANNOT BE GIVEN EFFECT SINCE THEY WERE NOT ISSUED
IN ACCORDANCE WITH THE AUTHORITY CONTAINED IN THE JTR.
TO MAJOR C. D. PREETORIOUS:
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 26, 1971, REFERENCE
DSASC-MF, FORWARDED HERE BY THE PER DIEM, TRAVEL AND TRANSPORTATION
ALLOWANCE COMMITTEE ON MARCH 12, 1971, PDTATAC CONTROL NO. 71-17, FOR
AN ADVANCE DECISION WHETHER VOUCHERS COVERING PER DIEM IN EXCESS OF THAT
AUTHORIZED BY THE TRAVEL ORDER MAY BE PAID TO MR. ERNEST D. ELLIS AND
MR. GORDON D. SIEKER, EMPLOYEES OF THE DEFENSE SUPPLY AGENCY INCIDENT
TO ATTENDING A TRAINING SEMINAR AT THE UNITED STATES ARMY ROCK ISLAND
ARSENAL, ROCK ISLAND, ILLINOIS.
IT IS NOTED THAT THE VOUCHERS ALSO COVER REIMBURSEMENT OF TRAVEL
EXPENSES BETWEEN THE RESIDENCE AND AIRPORT; HOWEVER, YOU DO NOT
QUESTION THIS AND OUR DECISION WILL BE LIMITED TO THE INCREASED PER DIEM
RATE. THE INFORMATION OF RECORD SHOWS BY TRAVEL ORDERS ISSUED IN JANUARY
1971 THE TWO EMPLOYEES WERE TO PROCEED ON OR ABOUT JANUARY 31, 1971,
FROM THEIR HEADQUARTERS IN ALEXANDRIA, VIRGINIA, TO ROCK ISLAND ARSENAL,
ROCK ISLAND, ILLINOIS, TO ATTEND A TRAINING COURSE (SEMINAR) FOR
APPROXIMATELY 13 DAYS. BOTH TRAVEL ORDERS AUTHORIZED PER DIEM IN
ACCORDANCE WITH THE JOINT TRAVEL REGULATIONS AND $20 PER DAY WHILE
ATTENDING SCHOOL. THE EMPLOYEES ARE CLAIMING $25 PER DIEM.
PARAGRAPH C 8101-2I OF THE JOINT TRAVEL REGULATIONS, VOLUME 2, CHANGE
64, DATED FEBRUARY 1, 1971, IN EFFECT AT THE TIME OF THE TRAVEL PROVIDES
AS FOLLOWS:
"I. PER DIEM RATES AT CERTAIN TRAINING COURSES. SPECIFIC PER DIEM
RATES ARE PRESCRIBED IN APPENDIX C, PART III, WHICH ARE APPLICABLE WHILE
ATTENDING TRAINING COURSES AT DESIGNATED LOCATIONS. THE RATES ARE
ESTABLISHED IN ACCORDANCE WITH PAR. C-8051-2E AND AUTHORITY CONTAINED
IN 5 U.S. CODE 4109."
YOU SAY THAT THE DEFENSE MANAGEMENT EDUCATION AND TRAINING CATALOG
(DOD 5010.16-C) DATED OCTOBER 1, 1970, STATES UNDER THE LISTING FOR
AMETA ON PAGE 26 AS FOLLOWS:
"PER DIEM RATES FOR BOTH MILITARY AND CIVILIAN PERSONNEL ON TEMPORARY
DUTY AT USAMETA FOR COURSE ATTENDANCE ARE GOVERNED BY THE JTR. TO
ASSIST LOCAL COMMANDERS IN ESTIMATING THE COST OF PER DIEM A SURVEY IS
FREQUENTLY MADE OF LOCAL NONGOVERNMENT FACILITIES TO DETERMINE ACTUAL
COST. THERE ARE NO GOVERNMENT TRANSIENT QUARTERS AVAILABLE. ALL THE
STUDENTS ARE QUARTERED ON THE LOCAL ECONOMY. A RECOMMENDED PER DIEM
RATE OF TWENTY ($20) DOLLARS IS ADEQUATE TO COVER ALL NORMAL EXPENSES
INCLUDED IN THE AUTHORIZED PER DIEM ALLOWANCES."
PARAGRAPH C 8051-2E, CHANGE 56, DATED JUNE 1, 1970, IN EFFECT AT THE
TIME OF THE TRAVEL PROVIDED THAT AN APPROPRIATE RATE OF PER DIEM NOT IN
EXCESS OF THE MAXIMUM RATE WILL BE ESTABLISHED FOR THOSE EMPLOYEES
ATTENDING A TRAINING COURSE. HOWEVER, THE RECOMMENDATION FOR THE
APPROPRIATE PER DIEM RATE WAS REQUIRED TO BE SUBMITTED THROUGH THE
APPROPRIATE HEADQUARTERS OFFICE TO THE PER DIEM, TRAVEL AND
TRANSPORTATION ALLOWANCE COMMITTEE FOR APPROVAL AND INCLUSION IN
APPENDIX C, PART III. THE INVITATIONS, ANNOUNCEMENTS, OR DIRECTIVES
RELATING TO THE TRAINING COURSE WOULD INCLUDE INFORMATION AND
INSTRUCTIONS REGARDING THE AVAILABILITY OF LOCAL FACILITIES AND
ARRANGEMENTS MADE FOR THEIR USE. PARAGRAPH C 8051-2E DOES NOT PROVIDE
AUTHORITY FOR THE LOCAL COMMANDING OFFICER TO INDEPENDENTLY ESTABLISH A
REDUCED PER DIEM RATE INCIDENT TO ATTENDANCE AT A TRAINING COURSE.
DURING THE PERIOD IN QUESTION, THERE WAS NO PRESCRIBED REDUCED RATE
CITED IN APPENDIX C, PART III, PERTAINING TO THE AFOREMENTIONED TRAINING
COURSE AT THE ROCK ISLAND ARSENAL.
IN VIEW OF THE ABOVE IT APPEARS THAT PARAGRAPH C 8101 IN EFFECT
DURING THE PERIOD COVERED BY THE VOUCHERS HERE INVOLVED PRESCRIBED A PER
DIEM IN LIEU OF SUBSISTENCE RATE OF $25 PER DAY FOR ALL TRAVEL AND
TEMPORARY DUTY. IN OUR DECISION B-168758 OF FEBRUARY 12, 1970, 49 COMP.
GEN. 493, WE HELD THAT REGULATIONS OF THE DEFENSE CONTRACT AUDIT AGENCY,
DEFENSE SUPPLY AGENCY, PROVIDING FOR THE PAYMENT OF A PER DIEM LESS THAN
$25 COULD NOT BE GIVEN EFFECT SINCE THEY WERE NOT ISSUED IN ACCORD WITH
AUTHORITY CONTAINED IN THE JOINT TRAVEL REGULATIONS. WE SEE NO REASON
WHY THAT CONCLUSION COULD NOT BE APPLICABLE HERE.
THEREFORE, THE VOUCHERS WHICH ARE RETURNED HEREWITH MAY BE PAID IF
OTHERWISE CORRECT.
B-171053, MAY 21, 1971
BID PROTEST - AMENDMENTS - ACKNOWLEDGEMENT
DENYING PROTEST OF EPSILON SIGMA PI, INC., AGAINST THE REJECTION OF
ITS LOW BID UNDER AN IFB ISSUED FOR PROCUREMENT OF LOAD CONTROLLERS, BY
THE NAVAL SHIP RESEARCH AND DEVELOPMENT CENTER, WASHINGTON, D.C., FOR
FAILURE TO ACKNOWLEDGE AN AMENDMENT.
FAILURE TO ACKNOWLEDGE AN AMENDMENT THAT SET FREQUENCY LIMITS ON THE
DITHER CIRCUIT FREQUENCY WITHOUT WHICH A BIDDER COULD DESIGN A CIRCUIT
FOR APPROXIMATELY ONE-TENTH THE COST OF THE REQUIRED CIRCUIT AND WHICH
ARE NECESSARY TO THE PROPER OPERATION OF THE CIRCUIT, IS A MATERIAL
DEVIATION AND NOT SUBJECT TO WAIVER UNDER ASPR 2-405.
TO EPSILON SIGMA PI, INCORPORATED:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 15, 1970,
PROTESTING THE REJECTION OF YOUR LOW BID UNDER INVITATION FOR BIDS NO.
N00167-71-B-0002, ISSUED BY THE NAVAL SHIP RESEARCH AND DEVELOPMENT
CENTER, WASHINGTON, D.C., BECAUSE OF YOUR FAILURE TO ACKNOWLEDGE RECEIPT
OF AMENDMENT 0001 TO THE INVITATION.
THE INVITATION, DATED JULY 30, 1970, SOLICITED BIDS ON 20 LOAD
CONTROLLERS AS SPECIFIED. BID OPENING WAS SCHEDULED FOR AUGUST 21,
1970. HOWEVER, AMENDMENT 0001 TO THE INVITATION ISSUED AUGUST 14, 1970,
EXTENDED THE BID OPENING DATE TO SEPTEMBER 4, 1970. IN ADDITION, THE
AMENDMENT ADDED TO SECTION 5.05 OF THE SPECIFICATION THE FOLLOWING
LANGUAGE: "THE DITHER CIRCUIT SHALL HAVE A FIXED FREQUENCY OF NO LESS
THAN 350HZ AND NO GREATER THAN 1000HZ." ALSO, FOR CLARIFICATION PURPOSES
SECTION 5.06 WAS AMENDED TO DEFINE "RPM" AS "RESETS PER MINUTE."
YOUR BID DID NOT ACKNOWLEDGE RECEIPT OF THE AMENDMENT. AFTER THE BID
OPENING, IN A LETTER DATED SEPTEMBER 24, 1970, YOU CONFIRMED YOUR
ORIGINALLY QUOTED PRICE WITHOUT ANY EXCEPTIONS, AND YOU ENCLOSED TWO
EXECUTED COPIES OF AMENDMENT 0001. YOU STATED THAT THE AMENDMENT
REACHED YOUR FIRM ON THE ORIGINALLY SCHEDULED DATE OF BID OPENING,
AUGUST 21, 1970, AND THAT SINCE THE SPECIFICATION CLARIFICATION DID NOT
AFFECT YOUR BID PRICE, YOU MISTAKENLY ASSUMED NO ACTION WAS REQUIRED ON
YOUR PART.
YOU CONTEND THAT YOUR FAILURE TO ACKNOWLEDGE THE AMENDMENT IS A MINOR
IRREGULARITY WHICH MAY BE WAIVED UNDER THE PROVISIONS OF ARMED SERVICES
PROCUREMENT REGULATION (ASPR) 2-405 SINCE THE AMENDMENT IS MERELY A
CLARIFICATION OF REQUIREMENTS AND HAS NO EFFECT ON QUANTITY, QUALITY OR
DELIVERY OF THE ITEM.
IT IS ADMINISTRATIVELY EXPLAINED THAT THE SPECIFICATION, AS
ORIGINALLY WRITTEN, DID NOT INCLUDE THE FREQUENCY LIMITS FOR THE
SPECIFIED DITHER CIRCUIT; THAT THE DITHER CIRCUIT IS AN OSCILLATOR
CIRCUIT WHICH SUPPLIES AN ELECTRICAL SIGNAL THROUGH THE LOAD CONTROLLER
TO A SERVO VALVE CAUSING THE SERVO VALVE SPOOL TO VIBRATE AND IMPROVE
THE RESPONSE OF THE VALVE TO SMALL SIGNALS; THAT IT IS NECESSARY FOR
THE FREQUENCY OF THE DITHER CIRCUIT TO BE HIGH ENOUGH SO THAT THE VALVE
SPOOL WILL NOT ACTUALLY MOVE BACK AND FORTH; BUT AT THE SAME TIME THE
FREQUENCY MUST BE LOW ENOUGH SO THAT IT CAN REACT; AND THAT THE
AMENDMENT INCLUDED THESE FREQUENCY LIMITS. IT IS FURTHER STATED THAT
UNDER THE SPECIFICATIONS AS ORIGINALLY WRITTEN A BIDDER COULD HAVE
ASSUMED THAT 60 CYCLES PER SECOND WAS A SUITABLE DITHER FREQUENCY AND
USED THE 115 VOLTS AC INCOMING POWER AS THE FREQUENCY SOURCE; THAT THIS
WOULD ELIMINATE THE NEED FOR DESIGN AND CONSTRUCTION OF AN OSCILLATOR
CIRCUIT AND COULD BE DONE FOR APPROXIMATELY ONE-TENTH THE COST OF THE
REQUIRED CIRCUIT; AND THAT USING THIS METHOD WOULD ALSO ALLOW THE
CONTRACTOR TO REDUCE THE OVERALL QUALITY OF THE OTHER CIRCUITS AS AC
POWER FREQUENCY NOISE WOULD BE MASKED BY THE DITHER CIRCUITS. FINALLY,
IT IS EXPLAINED THAT THE SERVO VALVE SPOOL IS CAPABLE OF FOLLOWING A 60
CYCLE PER SECOND SIGNAL AND WOULD ACTUALLY MOVE BACK AND FORTH, THUS
INTRODUCING UNDESIRED RESPONSES IN THE CONTROLLED DEVICE, AND THAT FOR
THIS REASON ANY SOURCE OF SIGNALS NEAR THIS FREQUENCY GENERATED IN THE
LOAD CONTROLLERS IS UNACCEPTABLE AND WOULD RESULT IN REJECTION OF THE
LOAD CONTROLLERS.
IT IS THE GENERAL RULE THAT IF AN ADDENDUM TO AN INVITATION AFFECTS
THE PRICE, QUANTITY OR QUALITY OF THE PROCUREMENT, THE FAILURE OF THE
BIDDER TO ACKNOWLEDGE ITS RECEIPT IN A MANNER REQUIRED BY THE INVITATION
RENDERS THE BID NONRESPONSIVE AND SUCH FAILURE CANNOT BE WAIVED. 37
COMP. GEN. 785 (1958). SINCE THE SUBJECT MATTER OF AMENDMENT 0001
DEFINES THE FREQUENCY LIMITS FOR A DITHER CIRCUIT AND WAS NECESSARY FOR
PROPER INTERPRETATION OF THE SPECIFICATIONS, THE FAILURE TO ACKNOWLEDGE
THE AMENDMENT PRIOR TO BID OPENING WOULD ALLOW A BIDDER TO SUBMIT A BID
OFFERING A DITHER CIRCUIT FREQUENCY OUTSIDE THE LIMITS SET BY AMENDMENT
0001. THEREFORE, YOUR FAILURE TO ACKNOWLEDGE AMENDMENT 0001 PRIOR TO
BID OPENING WAS A MATERIAL DEVIATION AND NOT SUBJECT TO WAIVER UNDER
ASPR 2-405.
UNDER THE CIRCUMSTANCES WE MUST CONCLUDE THAT YOUR BID WAS PROPERLY
DETERMINED TO BE NONRESPONSIVE. YOUR PROTEST IS THEREFORE DENIED.
B-171468, MAY 21, 1971
BID PROTEST - BIDDER RESPONSIBILITY
DENYING PROTEST OF Z-D PRODUCTS AGAINST THE AWARD MADE BY THE
FRANKFORT ARSENAL, DEPARTMENT OF THE ARMY, UNDER AN IFB TO REMCO
HYDRAULICS, INC., AND REJECTION OF ITS LOW BID.
THE COMP. GEN. FINDS THAT THE RECORD ADEQUATELY SUPPORTS THE
ADMINISTRATIVE POSITION THAT PORTESTANT WAS NONRESPONSIBLE.
TO CLIFFORD, WARNKE, GLASS, MCILWAIN & FINNEY:
WE REFER TO YOUR LETTER OF JANUARY 4, 1971, ADVISING OF THE SPECIFIC
GROUNDS UPON WHICH PROTEST OF Z-D PRODUCTS IS MADE AGAINST THE AWARD
MADE BY FRANKFORD ARSENAL, DEPARTMENT OF THE ARMY, UNDER FORMALLY
ADVERTISED SOLICITATION NO. DAAA25-71-B-0045 DATED AUGUST 21, 1970.
SUBSEQUENT TO THE REJECTION OF Z-D PRODUCTS' LOW BID AND THAT OF FOREST
SCIENTIFIC, INC., ON THE BASIS OF NONRESPONSIBILITY, THE CONTRACT WAS
AWARDED ON NOVEMBER 19, 1970, TO REMCO HYDRAULICS, INC., AT A COST
(ABOUT $32,000) IN EXCESS OF THE BID OF Z-D PRODUCTS.
THE REPORT OF THE ARMY MATERIEL COMMAND ON THE MERITS OF THE PROTEST
WAS FURNISHED TO YOU FOR INFORMATION AND COMMENT. BY LETTER OF FEBRUARY
5, 1971, YOU ADVISED THAT THE ADMINISTRATIVE REPORT - DEALING WITH BASES
UPON WHICH IT WAS DETERMINED THAT Z-D PRODUCTS WAS A NONRESPONSIBLE
BIDDER FOR THE PURPOSE OF THIS PROCUREMENT - DID NOT ANSWER EFFECTIVELY
THE ALLEGATION THAT Z-D PRODUCTS WAS, AND STILL IS, A RESPONSIBLE
PROSPECTIVE CONTRACTOR FOR THE END ITEMS ADVERTISED. ON THE RECORD
BEFORE US, WE FIND NO BASIS TO DISAGREE WITH THE DETERMINATION MADE AS
TO Z-D PRODUCTS' NONRESPONSIBILITY. YOUR COMMENTS ON THE ADMINISTRATIVE
REPORT DO NOT OVERCOME THE ADVERSE FINDINGS UPON WHICH THE DETERMINATION
WAS BASED. THE PREAWARD SURVEY REPORT RECOMMENDED "NO AWARD" TO Z-D
PRODUCTS BECAUSE IT WAS DEFICIENT IN PRODUCTION CAPABILITY, QUALITY
ASSURANCE, PAST PERFORMANCE RECORD AND ABILITY TO MEET THE REQUIRED
DELIVERY SCHEDULE. THESE ADVERSE FINDINGS, WHILE DISPUTED, HAVE NOT
BEEN REFUTED BY EVIDENCE TO THE CONTRARY. IN THIS RESPECT, WE DO NOT
FEEL THAT IT IS NECESSARY, FOR THE PURPOSES OF THIS DECISION, TO DETAIL
AND SUPPORT THESE ADVERSE FINDINGS. SUFFICE IT TO SAY THAT THE ENTIRE
RECORD AMPLY SUPPORTS THE ADMINISTRATIVE POSITION THAT Z-D PRODUCTS WAS
NOT ENTITLED TO AN AWARD BECAUSE IT WAS DETERMINED TO BE A
NONRESPONSIBLE BIDDER.
PARAGRAPH 1-904.1 OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR)
PRECLUDES AN AWARD OF THIS KIND UNLESS THE CONTRACTING OFFICER FIRST
MAKES AN AFFIRMATIVE DETERMINATION THAT THE PROSPECTIVE CONTRACTOR IS
RESPONSIBLE UNDER THE CRITERIA SET OUT IN ASPR 1-903. ONE OF THOSE SET
OUT AT ASPR 1-903.1(II) IS THAT A PROSPECTIVE CONTRACTOR TO QUALIFY AS
RESPONSIBLE MUST "BE ABLE TO COMPLY WITH THE REQUIRED OR PROPOSED
DELIVERY OR PERFORMANCE SCHEDULE." ANOTHER REQUIREMENT SET OUT AT ASPR
1-903.1(III) IS THAT A PROSPECTIVE CONTRACTOR MUST "HAVE A SATISFACTORY
RECORD OF PERFORMANCE (CONTRACTORS WHO ARE SERIOUSLY DEFICIENT IN
CURRENT CONTRACT PERFORMANCE, WHEN THE NUMBER OF CONTRACTS AND THE
EXTENT OF DEFICIENCY OF EACH ARE CONSIDERED, SHALL, IN THE ABSENCE OF
EVIDENCE TO THE CONTRARY OR CIRCUMSTANCES PROPERLY BEYOND THE CONTROL OF
THE CONTRACTOR, BE PRESUMED TO BE UNABLE TO MEET THIS REQUIREMENT)."
IN VIEW OF THE RECORD, PART OF WHICH WAS MADE AVAILABLE TO YOU, AN
AFFIRMATIVE DETERMINATION COULD NOT BE MADE UNDER ASPR 1-904.1 THAT Z-D
PRODUCTS WAS A RESPONSIBLE BIDDER AND ITS BID WAS THEREFORE REJECTED.
WE FIND NO EVIDENCE THAT THE PREAWARD SURVEY WAS IRREGULAR,
INACCURATE, OR UNFAIR AND, ON THE BASIS OF THE PRESENT RECORD, WE MUST
CONCLUDE THAT THE DETERMINATION OF LACK OF RESPONSIBILITY IS NOT SUBJECT
TO LEGAL OBJECTION. 43 COMP. GEN. 228 (1963); B-165386, NOVEMBER 26,
1968; AND B-170664, OCTOBER 29, 1970.
ACCORDINGLY, YOUR PROTEST IS DENIED.
B-171794, MAY 21, 1971
BID PROTEST - ERROR IN BID - CONFIRMATION
DENYING PROTEST OF WOLVERINE DIESEL POWER COMPANY AGAINST THE AWARD
OF A CONTRACT TO LIBBY WELDING COMPANY UNDER AN IFB ISSUED BY THE U.S.
ARMY MOBILITY EQUIPMENT COMMAND, ST. LOUIS, MISSOURI, FOR PROCUREMENT OF
95 UTILITY ELEMENTS.
LIBBY, AFTER BEING ADVISED OF THE POSSIBILITY OF ERROR IN ITS BID BY
REASON OF THE DISPARITY IN BIDS, CONFIRMED ITS BID PRICE. THE PRE-AWARD
SURVEY DISCLOSED NO EVIDENCE OF POSSIBLE MISTAKE. IN THE CIRCUMSTANCES,
THERE IS NO BASIS ON WHICH TO CONCLUDE THAT THE PRICE WAS COMPUTED IN
ERROR. EVEN IF LIBBY CANNOT PERFORM THE CONTRACT AT ITS BID PRICE, NO
LEGAL PRINCIPLE PRECLUDES AWARD MERELY BECAUSE THE LOW BIDDER SUBMITTED
AN UNPROFITABLE PRICE.
TO WOLVERINE DIESEL POWER COMPANY:
REFERENCE IS MADE TO YOUR TELEFAX DATED JANUARY 28, 1971, AND LETTERS
DATED FEBRUARY 15 AND MARCH 9, 1971, PROTESTING THE AWARD OF A CONTRACT
TO LIBBY WELDING COMPANY UNDER INVITATION FOR BIDS NO.
DAAK01-71-B-1732, ISSUED BY THE UNITED STATES ARMY MOBILITY EQUIPMENT
COMMAND (MECOM), ST. LOUIS, MISSOURI.
THE SOLICITATION, FOR A FORMALLY ADVERTISED PROCUREMENT, WAS ISSUED
ON OCTOBER 1, 1970, FOR 95 UTILITY ELEMENTS, WITH RELATED ITEMS. A
PRE-BID CONFERENCE WAS HELD AT MECOM ON OCTOBER 15, 1970, FOR THE
PURPOSE OF BRIEFING PROSPECTIVE BIDDERS AND EXPLAINING SPECIFICATIONS
AND REQUIREMENTS. ALL PROSPECTIVE BIDDERS WERE FURNISHED COPIES OF THE
PRE-BID CONFERENCE MINUTES. SIX AMENDMENTS WERE ISSUED TO THE
SOLICITATION INCORPORATING A PRE-PRODUCTION AND PRODUCTION EVALUATION
CLAUSE, ANSWERING PRE-BID CONFERENCE QUESTIONS, AND OF PARTICULAR
IMPORTANCE, SUBSTITUTING THE REQUIREMENT THAT BIDS BE BASED ON STATED
GOVERNMENT-FURNISHED, SOLE-SOURCE EQUIPMENT IN LIEU OF
CONTRACTOR-FURNISHED EQUIPMENT. THE BID OPENING DATE WAS EXTENDED TO
DECEMBER 4, 1970.
OF THE NINE BIDS RECEIVED, LIBBY'S, AS EVALUATED, WAS OVER $600,000
LESS THAN THE NEXT LOW BID OF WOLVERINE DIESEL POWER COMPANY, AND OVER
ONE MILLION DOLLARS LESS THAN THE THIRD LOW BID.
NOTING THE PRICE DISPARITY BETWEEN THE LIBBY BID AND THE NEXT BIDS,
THE CONTRACTING OFFICER ADVISED LIBBY BY TELEGRAM OF THE POSSIBILITY OF
A MISTAKE IN BID. LIBBY, BY TELEGRAM OF DECEMBER 11, 1970, REPLIED IN
RESPONSE THAT "WE HAVE REVIEWED OUR BID WORKSHEETS AND DATA USED TO
PREPARE OUR BID AND WE CONFIRM OUR PRICES AS BID." AWARD WAS MADE TO
LIBBY ON JANUARY 21, 1971.
YOU CONTEND THAT THERE IS NO WAY FOR LIBBY TO PERFORM AND DELIVER THE
EQUIPMENT AT THE AWARD PRICE BECAUSE YOU AND THE THIRD LOW BIDDER,
TECHNICALLY COMPETENT AND EXPERIENCED COMPANIES, BID $700,000 TO
$1,000,000 HIGHER.
THE RECORD SHOWS THAT A PRE-AWARD SURVEY WAS CONDUCTED ON LIBBY BY
THE DEFENSE CONTRACT ADMINISTRATION SERVICES, KANSAS CITY, MISSOURI. THE
SURVEY REPORT CONFIRMS THAT COMMITMENTS HAD BEEN RECEIVED BY LIBBY ON
ALL PARTS AND MATERIALS REQUIRED BY THE DRAWINGS WITH DELIVERY DATES
PROVIDED ON EACH AND THAT LIBBY WAS CAPABLE OF MEETING THE FINANCIAL
COMMITMENTS NECESSARY TO COMPLETE THE CONTRACT. THE SURVEY TEAM
RECOMMENDED COMPLETE AWARD TO LIBBY.
LIBBY, AFTER BEING ADVISED OF THE POSSIBILITY OF ERROR IN ITS BID BY
REASON OF THE DISPARITY IN BIDS, CONFIRMED ITS BID PRICE. ALSO THE
PRE-AWARD SURVEY DISCLOSED NO EVIDENCE OF POSSIBLE MISTAKE. IN THE
CIRCUMSTANCES, WE FIND NO BASIS ON WHICH TO CONCLUDE THAT THE PRICE WAS
COMPUTED IN ERROR. EVEN IF LIBBY CANNOT PERFORM THE CONTRACT AT ITS BID
PRICE, WE ARE AWARE OF NO LEGAL PRINCIPLE ON WHICH AN AWARD MAY BE
PRECLUDED OR DISTURBED MERELY BECAUSE THE LOW BIDDER SUBMITTED AN
UNPROFITABLE PRICE. B-149551, AUGUST 16, 1962; B-150318, MARCH 25,
1963. SEE ALSO B-170360, APRIL 6, 1971.
YOU CONTEND THAT THE CONTRACT ADMINISTRATOR FOR WOLVERINE MADE A
VISIT TO MECOM ON JANUARY 14, 1971, AND WAS NOT GIVEN THE OPPORTUNITY TO
PERSONALLY DISCUSS THE BID WITH MECOM REPRESENTATIVES. THE
ADMINISTRATIVE REPORT INDICATES THAT A REPRESENTATIVE OF THE CONTRACTING
OFFICER, TO WHOM YOUR CONTRACT ADMINISTRATOR WAS REFERRED WAS NOT ABLE
TO MEET WITH THE LATTER BECAUSE OF SCHEDULING CONFLICTS, BUT THE TWO DID
DISCUSS THE MATTER BY PHONE. IT IS REGRETTABLE THAT ARRANGEMENTS COULD
NOT HAVE BEEN MADE FOR THE PERSONAL MEETING WHICH YOU APPARENTLY HAD
EXPECTED AND DESIRED. HOWEVER, THE FAILURE TO OBTAIN THE MEETING CAN
HAVE NO EFFECT ON THE VALIDITY OF THE AWARD. YOUR PROTEST IS
ACCORDINGLY DENIED.
B-171854(1), MAY 21, 1971
BID PROTEST - AMBIGUITY - OPTION
DENYING PROTEST OF SUN PHOTOGRAPHICS, INC., AGAINST THE AWARD OF A
CONTRACT UNDER AN IFB ISSUED BY THE GODDARD SPACE FLIGHT CENTER FOR
STILL PHOTOGRAPHIC SERVICES TO ANOTHER BIDDER.
PROTESTANT'S ALLEGATION THAT THE AMENDMENT TO THE SOLICITATION
STATING "AWARD WILL BE MADE FOR TWO YEARS, HOWEVER, EVALUATION FOR AWARD
WILL BE MADE ON AN ALL OR NOTHING BASIS FOR FIRST YEAR OF PERFORMANCE"
IS AMBIGUOUS WILL NOT STAND WHEN READ IN CONJUNCTION WITH ARTICLES II
AND III OF THE IFB WHICH SPECIFY A ONE YEAR PERIOD AND IN LIGHT OF THE
FACT THAT THE MEANING OF THE AMENDMENT WAS EXPLAINED AT A PRE-BID
CONFERENCE.
NOR CAN PROTESTANT'S CONTENTION THAT AWARD BE MADE ON BASIS OF THE
TOTAL OF THE FIRST AND SECOND YEARS' PRICES ON WHICH IT WOULD BE LOW BE
PUT IN EFFECT SINCE IT IS CONTRARY TO THE TERMS OF THE IFB AND,
FOLLOWING THE REASONING OF 41 COMP. GEN. 203 (1961), A HIGH BID MAY NOT
BE ACCEPTED UPON THE BASIS THAT IT MAY BECOME LOW UPON THE OCCURENCE OF
AN UNCERTAIN EVENT.
TO SUN PHOTOGRAPHICS, INC.:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 5, 1971, WITH
ENCLOSURES, AS SUPPLEMENTED BY LETTER DATED FEBRUARY 18, 1971, FROM YOUR
ATTORNEYS, PROTESTING AWARD TO ANOTHER BIDDER UNDER INVITATION FOR BIDS
(IFB) NO. S03013/667, ISSUED DECEMBER 30, 1970, BY GODDARD SPACE FLIGHT
CENTER (GSFC), NATIONAL AERONAUTICS AND SPACE ADMINISTRATION.
THE IFB CALLED FOR THE FURNISHING OF STILL PHOTOGRAPHIC SERVICES, AND
SPECIFICALLY PROVIDED THAT THE PERIOD OF PERFORMANCE WOULD BE FOR ONE
YEAR UNDER ARTICLE II - PERIOD OF PERFORMANCE. ARTICLE III - OPTIONS,
STATED THE CONTRACT WAS RENEWABLE AT THE OPTION OF THE GOVERNMENT FOR A
TOTAL CONTRACT PERIOD NOT TO EXCEED TWO YEARS DURATION, AND REQUIRED THE
CONTRACTING OFFICER TO GIVE THE CONTRACTOR WRITTEN NOTICE OF RENEWAL
WITHIN THE PERIOD OF PERFORMANCE. THE SERVICES WERE TO BE FURNISHED ON
AN "AS REQUIRED" BASIS.
ON DECEMBER 30, 1970, AMENDMENT NO. 1 TO THE IFB WAS ISSUED WHICH
STATED IN PERTINENT PART:
"(C) FOR THE OPTION PERIOD OF PERFORMANCE, PLEASE COMPLETE THE
'ATTACHMENT A - SCHEDULE OF RATES (FOR SECOND YEAR)', WHICH IS ATTACHED
TO THIS AMENDMENT NO. ONE (1).
"AWARD WILL BE MADE FOR TWO (2) YEARS; HOWEVER, EVALUATION FOR AWARD
WILL BE MADE ON AN 'ALL OR NOTHING BASIS' FOR FIRST YEAR OF PERFORMANCE
ONLY."
ON JANUARY 21, 1971, MR. STANLEY OSBORNE, OF YOUR FIRM, MET WITH THE
CONTRACTING OFFICER, TO DISCUSS THE IFB. THE CONTRACTING OFFICER
REPORTS THAT DISCUSSION AS FOLLOWS:
"A SUN PHOTOGRAPHIC'S REPRESENTATIVE, MR. STANLEY OSBORNE, CONTACTED
THE UNDERSIGNED ON JANUARY 20, 1971, AND WANTED TO DISCUSS THE IFB ON
SAID DATE; HOWEVER, DUE TO PRIOR COMMITMENTS ON MY PART, I COULD NOT
SEE HIM ON THE 20TH BUT INDICATED THAT I COULD SET UP AN APPOINTMENT
WITH HIM THE NEXT DAY. MR. OSBORNE ACKNOWLEDGED MY SCHEDULE AND HE
ARRIVED IN MY OFFICE AT 10:37 A.M. ON THE 21ST. I DEVOTED ALMOST ONE
(1) HOUR TO HIS COMPANY'S INQUIRIES (UNTIL 11:30 A.M.) IN ORDER TO
EXPLAIN THE ENTIRE IFB REQUIREMENT TO HIS COMPLETE SATISFACTION. I
BELIEVE THIS WAS ACCOMPLISHED AT THE TIME. WHEN HE ARRIVED, HE DID NOT
KNOW THE NATURE OF THE GSFC REQUIREMENTS, I.E., IQ ('CALL TYPE')
CONTRACT, WEIGHTED AVERAGES OF INDIVIDUAL ITEMS, BASIS OF AWARD,
OPTIONS, ETC. WHEN HE LEFT MY OFFICE TO SEE THE TECHNICAL INITIATOR FOR
THIS PROCUREMENT, HE INDICATED TO ME THAT HE THOROUGHLY UNDERSTOOD THE
IFB AND GSFC'S INTENTS. THIS WAS QUITE EVIDENT SINCE DURING THE
DISCUSSION, HE WAS APPRISED, IN PARTICULAR, OF THE INTENT OF THE
LANGUAGE IN AMENDMENT NO. 1 TO THE IFB AND WHY SAID AMENDMENT WAS
ISSUED. HE WAS DEFINITELY ADVISED THAT THE TERMINOLOGY IN SAID
AMENDMENT NO. 1 MEANT THAT GSFC INTENDED TO AWARD A ONE (1) YEAR FIRM
PERIOD OF PERFORMANCE CONTRACT WHICH INCLUDED A FIRM ONE (1) YEAR OPTION
PERIOD OF PERFORMANCE. HE WAS ALSO ADVISED THAT THE OPTION PERIOD OF
PERFORMANCE COULD BE UNILATERALLY EXERCISED BY THE CONTRACTING OFFICER
IF A 'TEST OF THE MARKET' INDICATED THAT THE OPTION PERIOD BILLING RATES
WERE ADVANTAGEOUS TO THE GOVERNMENT. MR. OSBORNE HAD SOME DIFFICULTY IN
UNDERSTANDING THE OPTION AND THE AWARD BASIS. THEREFORE, THE IFB METHOD
OF EVALUATION WAS POINTED OUT AS BEING VERY SPECIFIC (ON AN 'ALL OR
NOTHING' BASIS FOR THE FIRST YEAR OF PERFORMANCE ONLY) AND THAT NO
TOTALS WERE INCLUDED ON THE 'SCHEDULE OF RATES' BID FORMS IN THE IFB
PACKAGE FOR THE 2ND (OR OPTION) YEAR OF PERFORMANCE. MR. OSBORNE STATED
THAT HE UNDERSTOOD AND WOULD BID ON THIS BASIS.
"MR. OSBORNE THEN ASKED THE PURPOSE OF OPTIONS AND WHY THEY ARE USED.
I TOLD HIM THAT THE OPTION PERIOD OF PERFORMANCE FOR THIS PARTICULAR
REQUIREMENT WAS AN ATTEMPT TO CONSERVE GSFC MANPOWER RESOURCES NEXT YEAR
(WHEN THE OPTION WAS TO BE EXERCISED) WHICH WOULD NORMALLY BE REQUIRED
FOR A COMPLETE IFB PROCUREMENT PROCESS AND THAT, ADDITIONALLY, AN OPTION
MIGHT TEND TO ELICIT MORE FAVORABLE PRICES FROM INDUSTRY SINCE A
POTENTIAL TWO (2) YEAR EFFORT IS MORE ATTRACTIVE AND INDICATES A
CONTINUING REQUIREMENT. HOWEVER, IT WAS STATED TO MR. OSBORNE THAT THE
OPTION WOULD HAVE TO BE ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER
FACTORS OF CONSIDERATION TO THE CENTER, OR IT WOULD NOT BE EXERCISED."
SUN PHOTOGRAPHICS, INC., TOOK NO EXCEPTION TO THE PROCEDURES AS
CLARIFIED AND, ALONG WITH THE COMPETITOR FIRMS, SUBMITTED ITS BID ON
JANUARY 22, 1971. BIDS WERE OPENED THE SAME DAY AT 2:00 P.M. THE
FOLLOWING FIGURES ARE THE BIDS SUBMITTED, EXCLUSIVE OF DISCOUNTS:
FIRM 1ST YEAR 2ND YEAR
BARA PHOTOGRAPHICS, INC. $122,642.56 $140,953.16
SUN PHOTOGRAPHICS, INC. 126,258.00 126,258.00
J. R. DUNLOP 146,832.00 158,534.00
AWARD WAS MADE TO THE LOWEST RESPONSIVE BIDDER, BARA PHOTOGRAPHICS,
ON FEBRUARY 4, 1971, FOR THE FIRST YEAR'S REQUIREMENTS.
YOU CONTEND THAT PARAGRAPH (C) OF AMENDMENT NO. 1 RENDERED THE IFB
DEFECTIVE DUE TO AMBIGUITY; THAT SUN PHOTOGRAPHICS WAS THE LOWEST
RESPONSIVE BIDDER; AND THAT ANY PREBID CONFERENCE SHOULD NOT BE RELIED
UPON TO ALTER THE TERMINOLOGY OF THE AMENDMENT.
CONCERNING YOUR CONTENTION THAT AMENDMENT NO. 1 TO THE IFB, WAS SO
AMBIGUOUS AS TO RENDER THE SOLICITATION FATALLY DEFECTIVE, AN AMBIGUITY
EXISTS ONLY IF TWO OR MORE REASONABLE INTERPRETATIONS ARE POSSIBLE.
JEFFERSON CONSTRUCTION CO. V UNITED STATES, 151 CT. CL. 75 (1960).
CONSIDERING THE STATEMENT IN THE AMENDMENT THAT "AWARD WILL BE MADE FOR
TWO (2) YEARS" IN THE CONTEXT OF THE ENTIRE SOLICITATION, IT IS READILY
APPARENT THAT SUCH STATEMENT IS INCONSISTENT WITH ARTICLES II AND III OF
THE IFB, AND THE AMENDMENT DID NOT PURPORT TO MODIFY THOSE ARTICLES.
ARTICLE II SPECIFIED THE PERIOD OF PERFORMANCE AS ONE YEAR, AND
INCLUSION OF THE OPTION IN THE AWARD FOR A TWO YEAR CONTRACT WOULD NOT
ONLY HAVE BEEN CONTRARY TO THE REQUIREMENT IN ARTICLE III THAT WRITTEN
NOTICE BE GIVEN WITHIN THE PERIOD OF PERFORMANCE, BUT WOULD HAVE
RENDERED ARTICLE III MEANINGLESS SINCE AN OPTION COULD NOT BE EXERCISED
UNDER THAT CLAUSE TO EXTEND THE TOTAL DURATION OF THE CONTRACT BEYOND
TWO YEARS. HENCE, THERE IS FOR APPLICATION OUR DECISION 41 COMP. GEN.
709 (1962) WHEREIN WE INDICATED THAT EVALUATION OF BIDS, WHERE OPTIONS
ARE INCLUDED, MUST BE MADE ON THE BASIS OF THE SERVICES CALLED FOR,
EXCLUSIVE OF THE OPTION, UNLESS THE OPTION IS TO BE EXERCISED AT THE
TIME OF THE AWARD.
ADDITIONALLY, THE STATEMENT THAT AWARD WOULD BE MADE FOR TWO YEARS I
INCOMPATIBLE WITH THE FURTHER STATEMENT IN THE AMENDMENT, THAT
EVALUATION WOULD BE MADE ON THE FIRST YEAR ONLY, SINCE BIDS MUST BE
EVALUATED ON THE BASIS OF THE TOTAL CONTRACT AWARDED, RATHER THAN ON A
PORTION OF THE CONTRACT.
EVEN IF YOUR CONTENTION OF MATERIAL AMBIGUITY WERE TO BE ACCEPTED, TO
PRECLUDE AWARD OF THE CONTRACT SUCH AMBIGUITY MUST ADVERSELY AFFECT
COMPETITION AMONG THE BIDDERS. 39 COMP. GEN. 834 (1960); 40 ID. 561
(1961). AS SHOWN ABOVE, THE METHOD OF EVALUATION AND AWARD WAS FULLY
EXPLAINED TO YOU, AND THERE IS NO INDICATION THAT THE PRICES SUBMITTED
BY YOU AND THE OTHER BIDDERS FOR THE FIRST AND OPTION YEARS WOULD HAVE
BEEN DIFFERENT HAD THE AMENDMENT NOT INCLUDED THE STATEMENT THAT AWARD
WOULD BE MADE FOR TWO YEARS. THUS, WE DO NOT FIND THAT INCLUSION OF THE
STATEMENT ADVERSELY AFFECTED THE COMPETITION.
AS TO YOUR CONTENTION THAT YOUR BID WAS THE LOWEST RESPONSIVE BID,
SINCE THE BASIS FOR EVALUATION WAS THE FIRST YEAR PRICE ONLY AND BARA'S
CONTRACT IS ONLY FOR THAT SINGLE YEAR, IT IS APPARENT THAT YOU DID NOT
SUBMIT THE LOWEST BID ON THE CONTRACT WHICH WAS AWARDED. ALSO, WE DO
NOT AGREE WITH YOUR STATEMENT THAT BARA CAN REQUIRE THE GOVERNMENT TO
PERMIT THAT FIRM TO PERFORM FOR THE SECOND YEAR AND, INASMUCH AS YOU
HAVE NOT CITED ANY LEGAL SUPPORT FOR YOUR POSITION, SUCH CONTENTION MUST
BE REJECTED.
CONCERNING YOUR ARGUMENT THAT THE PREBID CONFERENCE MAY NOT BE RELIED
UPON TO ALTER THE TERMS OF THE SOLICITATION, IT SHOULD BE OBSERVED THAT
THE CONTRACTING OFFICER'S ADVICE TO YOU - THAT BIDS WOULD BE EVALUATED
ON THE BASIS OF THE FIRST YEAR ONLY - WAS COMPLETELY CONSISTENT WITH THE
METHOD OF EVALUATION SPECIFIED IN THE IFB AND MAY NOT BE CONSTRUED AS
PURPORTING TO ALTER THE SOLICITATION IN SUCH RESPECT. AN AWARD,
HOWEVER, ON THE BASIS OF THE TOTAL OF THE FIRST AND SECOND YEARS' PRICES
AS YOU PROPOSE, WOULD NOT ONLY HAVE BEEN CONTRARY TO THE ADVICE GIVEN
YOU BUT WOULD HAVE REQUIRED ALTERING THE TERMS OF THE IFB. YOUR BID WAS
EVALUATED IN ACCORDANCE WITH THE ADVICE FURNISHED YOU AND THERE IS NO
INDICATION THAT YOU WERE MISLED AS TO THE MANNER IN WHICH YOUR BID
SHOULD BE SUBMITTED OR AS TO HOW IT WOULD BE EVALUATED. IN THIS
CONNECTION WE NOTE THAT YOUR PROTEST AS TO THE CLARITY OF THE
SOLICITATION WAS NOT MADE UNTIL AFTER THE OPENING OF BIDS, AND WE HAVE
HELD THAT THE TIME TO PROTEST THE ADEQUACY OR PROPRIETY OF A
SOLICITATION'S PROVISIONS IS BEFORE THE BID IS SUBMITTED, AND IN ANY
EVENT BEFORE BEING ADVISED OF THE CONTRACT AWARD. B-156825, JULY 26,
1965; B-161642; AUGUST 17, 1967; B-156025, MAY 4, 1965.
FINALLY, WE BELIEVE THAT 41 COMP. GEN. 203 (1961) IS APPLICABLE HERE.
IN THAT DECISION WE STATED THAT IT IS IMPROPER TO ACCEPT A HIGH BID
UPON THE BASIS THAT IT WILL BECOME THE LOW BID UPON THE OCCURRENCE OF A
CONTINGENCY THAT MIGHT OR MIGHT NOT ARISE. IN ADDITION TO THE
CONTINGENCY IN THE INSTANT CASE OF WHETHER IT WILL BE TO THE
GOVERNMENT'S PRICE ADVANTAGE TO EXERCISE ITS OPTION, THE AGENCY REPORTS
THAT GSFC'S FUTURE REQUIREMENTS MAY NECESSITATE REVISION OF THE
SPECIFICATIONS FOR THE OPTION YEAR AND, DUE TO RECENT REDUCTIONS IN
APPROPRIATIONS, IT IS QUESTIONABLE THAT FUNDS WILL BE AVAILABLE FOR ANY
PARTICULAR PROCUREMENT.
IN VIEW OF THE FOREGOING YOUR PROTEST IS DENIED.
B-171854(2), MAY 21, 1971
BID PROTEST - AMBIGUITY - OPTIONS
WITH RESPECT TO THE PROTEST OF SUN PHOTOGRAPHICS, INC., AN AMENDMENT
ISSUED BY THE PROCURING ACTIVITY CONTAINED LANGUAGE WHICH WAS
INCONSISTENT WITH ITS INTENT AS SHOWN BY THE SOLICITATION; IN FUTURE
SITUATIONS OF THIS NATURE, INCONSISTENCIES SHOULD BE CORRECTED BY AN
AMENDMENT TO THE SOLICITATION WHEN CALLED TO THE ATTENTION OF THE
PROCUREMENT PERSONNEL PRIOR TO BID OPENING.
TO DR. FLETCHER:
REFERENCE IS MADE TO A LETTER DATED MARCH 26, 1971, REFERENCE KDA-2,
FROM YOUR AGENCY FURNISHING US A REPORT ON THE PROTEST OF SUN
PHOTOGRAPHICS, INC., AGAINST AWARD OF A CONTRACT TO ANOTHER BIDDER UNDER
INVITATION FOR BIDS NO. S03013/667, ISSUED BY THE GODDARD SPACE FLIGHT
CENTER.
ENCLOSED IS A COPY OF OUR DECISION TODAY TO SUN PHOTOGRAPHICS, INC.,
DENYING ITS PROTEST. WHILE WE HAVE DENIED THE PROTEST, IT SHOULD BE
NOTED THAT AMENDMENT NO. 1 CONTAINED LANGUAGE WHICH WAS INCONSISTENT
WITH THE INTENT OF THE PROCURING ACTIVITY AS SHOWN BY THE ARTICLES OF
THE SOLICITATION. IT IS OUR VIEW THAT IN FUTURE SITUATIONS OF THIS
NATURE, INCONSISTENCIES SHOULD BE CORRECTED BY AN AMENDMENT TO THE
SOLICITATION WHEN CALLED TO THE ATTENTION OF THE PROCUREMENT PERSONNEL
PRIOR TO BID OPENING.
THE FILE RECEIVED WITH THE LETTER OF MARCH 26 IS RETURNED.
B-172079, MAY 21, 1971
BID PROTEST - NONRESPONSIVE BID - DEVIATIONS
DENIAL OF PROTEST OF DETECTO SCALES, INC., LOW BIDDER, AGAINST THE
AWARD OF A CONTRACT TO TRINER SCALE AND MANUFACTURING COMPANY UNDER IFB
ISSUED BY THE POST OFFICE DEPARTMENT FOR AIRPORT SCALES.
PROTESTANT, WHO HAD PREVIOUSLY SUPPLIED SUCH ITEMS, SUBMITTED A BID
TO PROVIDE SCALES AS BEFORE WITH A NEW PENDELUM AS CALLED FOR IN THE
INVITATION. AS THE SOLICITATION CALLED FOR MATERIAL CHANGES IN THE
SCALES TO BE PROVIDED, THE OFFER TO SUPPLY SCALES AS BEFORE WAS PROPERLY
REJECTED AS NONRESPONSIVE.
TO DETECTO SCALES INC.:
REFERENCE IS MADE TO YOUR TELEGRAM OF MARCH 4, 1971, AND SUBSEQUENT
CORRESPONDENCE, PROTESTING THE AWARD OF A CONTRACT TO ANOTHER FIRM ON
MARCH 3, 1971, UNDER INVITATION FOR BIDS NO. 3110, ISSUED DECEMBER 8,
1970, BY THE POST OFFICE DEPARTMENT, WASHINGTON, D.C.
THE SOLICITATION WAS FOR THE SUPPLY OF AN ESTIMATED QUANTITY OF 150
SPECIAL AIRPORT SCALES OF 100 POUND CAPACITY. THE GOVERNMENT RESERVED
THE RIGHT TO ORDER MORE OR LESS, AS REQUIRED, DURING THE CONTRACT PERIOD
ENDING JUNE 30, 1972. THESE SCALES WERE TO BE SUPPLIED IN ACCORDANCE
WITH POST OFFICE DEPARTMENT (POD) SPECIFICATION POD-S-145B(RE), DATED
NOVEMBER 3, 1969, AND FEDERAL SPECIFICATION AAA-S-121D(1), DATED OCTOBER
24, 1967. TWO BIDS WERE RECEIVED IN RESPONSE TO THE SOLICITATION AND
WERE OPENED AS SCHEDULED ON JANUARY 7, 1971. YOUR FIRM SUBMITTED THE
LOW BID OF $55,765.50, WHILE TRINER SCALE AND MANUFACTURING COMPANY
(TRINER), SUBMITTED THE OTHER BID OF $57,000.
ATTACHED TO YOUR BID WAS A LETTER IN WHICH YOU STATE:
"IN RESPONSE TO THE SUBJECT SOLICITATION WE OFFER OUR FOLLOWING
PROPOSAL. ONE HUNDRED AND FIFTY (150) DETECTO MODEL 2200 (V). AS
SUPPLIED ON P.O.D. CONTRACTS 8-1-00754, 7-1-00994 AND 7-1-01056, EXCEPT
THIS SCALE WILL BE SUPPLIED WITH A PENDULUM MECHANISM AS PER YOUR
SPECIFICATIONS."
BY TELEGRAM AND LETTER BOTH DATED JANUARY 11, 1971, TRINER PROTESTED
TO POD AGAINST AWARD TO YOUR FIRM. THE BASIS OF TRINER'S PROTEST WAS
THAT YOUR BID WAS NONRESPONSIVE SINCE YOU HAD STATED THAT THE 150 SCALES
WHICH YOU OFFERED TO SUPPLY WERE THE SAME AS SCALES SUPPLIED UNDER
PREVIOUS CONTRACTS WITH POD, THE SOLE EXCEPTION BEING THAT A PENDULUM
MECHANISM WOULD BE SUPPLIED AS PER SPECIFICATIONS REFERENCED IN THE
SUBJECT SOLICITATION. TRINER STATED THAT THE PREVIOUS CONTRACTS HAD
DIFFERENT SPECIFICATIONS AND THAT YOUR BID WAS NONRESPONSIVE SINCE IT
OFFERED TO SUPPLY SCALES IN ACCORDANCE WITH THE REQUIREMENTS OF THESE
PREDECESSOR SPECIFICATIONS, WITH THE SINGLE EXCEPTION OF THE PENDULUM
MECHANISM REQUIRED BY THE PRESENT SPECIFICATIONS. TRINER ALSO CONTENDED
THAT, SINCE THE 150 UNITS SHOWN IN THE SOLICITATION WERE AN ESTIMATED
QUANTITY WITH THE POD RESERVING THE RIGHT TO ORDER MORE, OR LESS, AS
REQUIRED, YOU QUALIFIED YOUR BID IN SUCH RESPECT BY OFFERING ONLY
SPECIFIC OR FIXED NUMBER OF SCALES.
ACCORDING TO THE RECORD, THE PREVIOUS CONTRACTS REFERRED TO IN THE
LETTER WHICH ACCOMPANIED YOUR BID, DID CONTAIN REQUIREMENTS DIFFERING
FROM THE REQUIREMENTS UNDER THE PRESENT SOLICITATION. SOME OF THE
DIFFERENCES ARE AS FOLLOWS:
1. THE PRESENT SOLICITATION CONTAINED AN ADDED REQUIREMENT ON PAGE 6
THEREOF MODIFYING PARAGRAPH 5 OF SPECIFICATION POD-S-145B(RE) BY A
CHANGE TO THE READING FACE OF THE SCALES. PRIOR SPECIFICATIONS
CONTAINED NO SUCH REQUIREMENT.
2. PARAGRAPH 13 OF SPECIFICATION POD-S-145B(RE) CONTAINED A
REQUIREMENT FOR CAM AND PENDULUM EQUILIBRATING ELEMENTS ONLY. TWO OF
THE THREE PREVIOUS SPECIFICATIONS HAD ALSO ALLOWED SPRING TYPE.
3. PARAGRAPH 15 OF SPECIFICATION POD-S-145B(RE) CONTAINED A
REQUIREMENT FOR PACKING IN A SOLID WOOD CRATE OF PONDEROSA PINE. THE
OLD SPECIFICATIONS REQUIRED ONLY CORRUGATED FIBERBOARD OR COMMERCIAL
STANDARDS.
4. PAGE 7 OF THE PRESENT SOLICITATION CONTAINED A REQUIREMENT
PERTAINING TO AN "EXPLODED VIEW" PAMPHLET ON THE ORDER OF AN OPERATOR'S
MANUAL CONTAINING CERTAIN INFORMATION AND INSTRUCTIONS FOR MAINTENANCE
AND REPAIR OF THE SCALE. NO SUCH REQUIREMENT WAS CONTAINED IN PRIOR
CONTRACTS MENTIONED BY YOU.
FOLLOWING A REVIEW OF THE BID PACKAGES AND THE TRINER PROTEST, POD
CONCLUDED THAT THE FOUR ABOVE-MENTIONED DIFFERENCES WERE MATERIAL.
SINCE YOU SPECIFICALLY GUARANTEED ONLY TO SUPPLY THE PENDULUM MECHANISM,
WHICH IS LISTED AS THE SECOND OF THE FOUR MATERIAL DIFFERENCES, THE
AGENCY CONSIDERED THAT YOUR INTENT WAS SUSPECT AS TO SUPPLYING THE OTHER
THREE CHANGED REQUIREMENTS. THE POD THEREFORE RECOMMENDED TO THE
CONTRACTING OFFICER THAT YOUR BID BE REJECTED AS NONRESPONSIVE, AND YOUR
BID WAS ACCORDINGLY REJECTED PURSUANT TO SECTION 1-2.404-2(A) OF THE
FEDERAL PROCUREMENT REGULATIONS (FPR), WHICH STATES:
"(A) ANY BID WHICH FAILS TO CONFORM TO THE ESSENTIAL REQUIREMENTS OF
THE INVITATION FOR BIDS, SUCH AS SPECIFICATIONS, DELIVERY SCHEDULE, OR
PERMISSIBLE ALTERNATES THERETO, SHALL BE REJECTED AS NONRESPONSIVE."
IN THIS REGARD, THIS OFFICE HAS CONSISTENTLY HELD THAT THE
ESTABLISHMENT OF SPECIFICATIONS WHICH REFLECT THE NEEDS OF THE
GOVERNMENT AND THE FACTUAL QUESTION OF WHETHER PRODUCTS OFFERED MEET THE
SPECIFICATIONS ARE MATTERS PRIMARILY FOR DETERMINATION BY THE
ADMINISTRATIVE AGENCY CONCERNED, TO BE QUESTIONED BY OUR OFFICE ONLY
WHEN NOT SUPPORTED BY SUBSTANTIAL EVIDENCE. 38 COMP. GEN. 190, 191
(1958). ALSO, WE HAVE HELD THAT THERE IS NO AUTHORITY FOR WAIVING AS AN
INFORMALITY OR MINOR IRREGULARITY A FAILURE OF A BID TO MEET ONE OR MORE
OF THE ESSENTIAL OR MATERIAL REQUIREMENTS OF THE GOVERNMENT'S INVITATION
FOR BIDS. 45 COMP. GEN. 365, 368 (1965).
THE TEST TO BE APPLIED IN DETERMINING THE RESPONSIVENESS OF A BID IS
WHETHER THE BID AS SUBMITTED IS AN OFFER TO PERFORM, WITHOUT EXCEPTION,
THE EXACT THING CALLED FOR IN THE INVITATION, AND WHETHER ACCEPTANCE
WILL BIND THE CONTRACTOR TO PERFORM IN ACCORDANCE WITH ALL THE TERMS AND
CONDITIONS THEREOF. B-160318, FEBRUARY 16, 1967. IN THE PRESENT CASE,
SINCE YOUR BID WAS NOT AN UNQUALIFIED OFFER TO SUPPLY SCALES IN
ACCORDANCE WITH THE SPECIFICATIONS, BUT RATHER AN OFFER TO SUPPLY SCALES
WHICH DIFFERED MATERIALLY FROM THOSE DESCRIBED BY THE SPECIFICATIONS, WE
CAN ONLY CONCLUDE THAT YOUR BID WAS NONRESPONSIVE.
MOREOVER, THIS OFFICE HAS CONSISTENTLY HELD THAT THE CONTRACT AWARDED
TO A BIDDER MUST BE THE SAME CONTRACT OFFERED TO ALL BIDDERS. 49 COMP.
GEN. 212, 214 (1969). IT IS APPARENT THAT ANY CONTRACT AWARDED TO YOU
ON THE BASIS OF YOUR BID WOULD NOT BE THE SAME AS THE CONTRACT OFFERED
TO TRINER, THE ONLY OTHER BIDDER, SINCE YOU WOULD NOT BE REQUIRED TO
SUPPLY THE EXACT ARTICLE CALLED FOR BY THE PRESENT SPECIFICATIONS.
THE ADMINISTRATIVE DETERMINATION CONCERNING THE NONRESPONSIVENESS OF
YOUR BID DOES NOT APPEAR TO HAVE BEEN ARBITRARY OR UNREASONABLE IN ANY
RESPECT. ACCORDINGLY, WE FIND NO LEGAL BASIS FOR OBJECTING TO THE
AWARDING OF THE CONTRACT TO TRINER. SINCE WE HAVE FOUND THAT YOUR BID
WAS NONRESPONSIVE TO THE SPECIFICATIONS, WE DO NOT CONSIDER IT NECESSARY
TO RULE ON TRINER'S CONTENTION THAT YOUR BID WAS ALSO QUALIFIED BY
OFFERING A SPECIFIC NUMBER OF SCALES.
B-172178, MAY 21, 1971
BID PROTEST - UNPROFITABLE PRICE
DENYING PROTEST OF NASH JANITORIAL SERVICE AGAINST THE AWARD OF A
CONTRACT TO KLEEN-RITE JANITORIAL SERVICE, INC., UNDER AN IFB ISSUED BY
THE GSA FOR JANITORIAL SERVICES AT BUILDING T-7 IN ARLINGTON, VIRGINIA.
EVEN IF IT IS CORRECT THAT KLEEN-RITE WOULD INCUR A LOSS IN
PERFORMING THE CONTRACT, ANTICIPATED LOSS IN PERFORMANCE DOES NOT
JUSTIFY REJECTING A BID.
TO NASH JANITORIAL SERVICE:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 12, 1971, AND SUBSEQUENT
CORRESPONDENCE CONCERNING YOUR PROTEST UNDER INVITATION FOR BIDS (IFB)
NO. GS-03B-12943, WHICH WAS ISSUED ON FEBRUARY 22, 1971, FOR JANITORIAL
SERVICES AT BUILDING T-7, ARLINGTON, VIRGINIA, FOR A PERIOD OF ONE YEAR
BEGINNING ON THE DATE SPECIFIED IN THE NOTICE OF AWARD. BIDS WERE
SOLICITED FOR THE REQUIRED CLEANING SERVICES AND FOR UNIT PRICES FOR TWO
TYPES OF ADDITIONAL FLOOR SERVICES, WHICH MAY BE REQUESTED, WITH AWARD
TO BE MADE IN THE AGGREGATE.
WHEN BIDS WERE OPENED ON MARCH 11, 1971, IT WAS NOTED THAT KLEEN-RITE
JANITORIAL SERVICE, INC. (KLEEN-RITE) HAD SUBMITTED THE LOWEST MONTHLY
BID FOR THE CLEANING SERVICES IN THE AMOUNT OF $22,640.
YOU STATE THAT KLEEN-RITE'S BID WAS BELOW THE MINIMUM ESSENTIAL COST
TO PERFORM THE JOB, AS COMPUTED BY YOUR CONCERN, AND SHOULD NOT BE
CONSIDERED FOR AWARD.
IN THIS REGARD GSA HAS FURNISHED US WITH THE FOLLOWING REPORT:
"THE REGISTER OF WAGE DETERMINATIONS AND FRINGE BENEFITS UNDER THE
MCNAMARA O'HARA SERVICE CONTRACT ACT CONTAINED ON PAGE 64 OF THE
INVITATION ESTABLISHES A MINIMUM HOURLY WAGE RATE OF $1.94, PLUS FRINGE
BENEFIT PAYMENTS OF $.06 AN HOUR FOR HEALTH AND WELFARE, AS WELL AS PAID
VACATIONS AND HOLIDAYS. PARAGRAPH 13 OF THE INVITATION, MINIMUM
MAN-HOUR WORK REQUIREMENTS, FOUND AT PAGE 13-14, REQUIRES 399 MAN-HOURS
PER DAY AS A MINIMUM FOR PERFORMANCE OF THE CONTRACT WORK.
"THE MINIMUM COSTS FOR LABOR BASED ON THE MINIMUM OF 399 MAN-HOURS
PER DAY AND THE WAGE DETERMINATION OF $1.94 PER HOUR PLUS $.06 AN HOUR
FOR HEALTH AND WELFARE, BUT EXCLUDING ANY AMOUNT FOR PAID VACATIONS AND
HOLIDAYS WOULD TOTAL APPROXIMATELY $17,290.00 PER MONTH, COMPUTED AS
FOLLOWS:
399 HOURS/DAY X $2 HOUR $ 798.00 PER DAY
1 DAY X 5 DAYS/WEEK 3,990.00 PER WEEK
1 WEEK X 52 WEEKS/YEAR 207,480.00 PER YEAR
1 YEAR DIVIDED BY MONTHS/YEAR 17,290.00 PER MONTH
* * * * *
"SUBSEQUENT TO THIS PROTEST THE CONTRACTING OFFICER MADE A VERBAL
REQUEST FOR VERIFICATION OF KLEEN-RITE'S BID AND FOLLOWED IT UP WITH A
WRITTEN REQUEST *** . KLEEN-RITE HAS CONFIRMED ITS BID PRICE AS BEING
CORRECT *** .
"IT IS ALSO SIGNIFICANT TO NOTE THAT KLEEN-RITE HAS THE CURRENT
CONTRACT FOR JANITORIAL SERVICES AT TEMPO 7 BUILDING AT A MONTHLY PRICE
OF $23,290.83, APPROXIMATELY $659.00 MORE THAN ITS BID PRICE ON THE
PENDING SOLICITATION. THAT CONTRACT IS FOR THE SAME SERVICES AND HAS
THE SAME WAGE DETERMINATION AND MINIMUM MAN-HOUR REQUIREMENTS. THE WORK
IS BEING PERFORMED IN A REASONABLY SATISFACTORY MANNER."
IN VIEW OF THE ABOVE FACTS, WE ARE UNABLE TO AGREE THAT KLEEN-RITE'S
BID IS UNREALISTIC. HOWEVER, EVEN IF WE ASSUME YOUR STATEMENT IS
CORRECT AND THAT KLEEN-RITE WOULD INCUR A LOSS IN PERFORMING THE
CONTRACT AT THE PRICE SHOWN IN ITS BID, OUR OFFICE HAS HELD THAT AN
ANTICIPATED LOSS IN PERFORMANCE DOES NOT JUSTIFY REJECTING AN OTHERWISE
ACCEPTABLE BID. B-171419, MARCH 15, 1971; 49 COMP. GEN. 311 (1969).
FOR THE REASONS SET FORTH ABOVE, YOUR PROTEST MUST BE DENIED.
B-171663, MAY 20, 1971
PUBLIC EXIGENCY - AMENDED DETERMINATION AND FINDINGS
IN VIEW OF NAVAIR'S AMENDED DETERMINATION AND FINDINGS CITING THE
PUBLIC EXIGENCY NEGOTIATION AUTHORITY OF 10 U.S.C. 2304(A)(2) THE COMP.
GEN. WILL IMPOSE NO LEGAL OBJECTION TO THE AWARD OF A CONTRACT TO
RAYTHEON COMPANY FOR TWO UHF COHERENT RADAR SYSTEMS UTILIZING THE
TRAVELLING WAVE TUBE APPROACH.
UPON RECONSIDERATION OF 50 COMP. GEN. --- (B-171663, APRIL 19, 1971)
WHEREIN IT WAS RECOMMENDED THAT THE NAVY HOLD FURTHER NEGOTIATIONS WITH
ALL OFFERORS IN A COMPETITIVE RANGE, INCLUDING SYLVANIA AND GENERAL
DYNAMICS, DUE TO THE URGENCY OF OBTAINING A COHERENT RADAR SYSTEM AND IN
LIGHT OF AMENDED DETERMINATIONS AND FINDINGS THAT ONLY RAYTHEON
PRESENTLY OFFERS THE DESIRED CHARACTERISTICS, A CONTRACT MAY BE AWARDED
TO RAYTHEON.
TO MR. SECRETARY:
ON APRIL 26, 1971, REPRESENTATIVES OF THE NAVAL AIR SYSTEMS COMMAND
(NAVAIR) MET WITH REPRESENTATIVES OF OUR OFFICE TO REQUEST
RECONSIDERATION OF OUR DECISION 50 COMP. GEN. --- (B-171663, APRIL 19,
1971), WHEREIN WE RECOMMENDED THAT FURTHER NEGOTIATIONS BE CONDUCTED
WITH ALL OFFERORS WITHIN A COMPETITIVE RANGE IN CONNECTION WITH THE
PROCUREMENT OF TWO UHF COHERENT RADAR SYSTEMS UNDER NAVAIR'S REQUEST FOR
QUOTATIONS N00019-70-Q-0195. THE CIRCUMSTANCES LEADING TO OUR
RECOMMENDATION FOR FURTHER NEGOTIATIONS ARE FULLY STATED IN THE DECISION
OF APRIL 19, 1971, AND WILL NOT BE REPEATED HERE.
IN ACCORDANCE WITH OUR REQUEST, THE ACTING COUNSEL, NAVAIR, BY LETTER
DATED APRIL 29, 1971, WITH ENCLOSURE, STATED THE BASIS FOR THE REQUEST.
COPIES OF THIS LETTER WERE MADE AVAILABLE TO THE INTERESTED PARTIES FOR
COMMENT, AND REPLIES WERE RECEIVED BY LETTERS DATED MAY 5 AND MAY 6,
1971, RESPECTIVELY, FROM GENERAL DYNAMICS AND SYLVANIA ELECTRONICS
PRODUCTS, INC., THROUGH ITS COUNSEL, SELLERS, CONNER & CUNEO.
IT IS NAVAIR'S POSITION THAT FURTHER NEGOTIATIONS WITH ALL PARTIES
WOULD NOT BE IN THE BEST INTERESTS OF THE GOVERNMENT. IT IS SAID THAT
NAVAIR IS NOW DEFINITELY PREDISPOSED TO THE RAYTHEON COMPANY'S
TRAVELLING WAVE TUBE (TWT) APPROACH, THEREBY RENDERING THE APPROACHES
OFFERED BY SYLVANIA AND GENERAL DYNAMICS TECHNICALLY UNACCEPTABLE. THE
ACTING COUNSEL'S LETTER FURTHER SUGGESTS THAT IT WOULD BE FUTILE TO
CONSIDER REVISED TECHNICAL AND PRICE PROPOSALS BASED ON A TWT APPROACH
FROM SYLVANIA AND GENERAL DYNAMICS BECAUSE, IN NAVAIR'S JUDGMENT, ONLY
RAYTHEON HAS THE ABILITY TO PERFORM ON THE BASIS OF A TWT SYSTEM; THAT
IS, THE RISKS INVOLVED IN AN AWARD OF A CONTRACT TO RAYTHEON ARE FAR
LESS WHEN PROBABLE PERFORMANCE AND COST ARE CONSIDERED THAN AN AWARD TO
EITHER SYLVANIA OR GENERAL DYNAMICS. IN THIS REGARD, A MEMORANDUM FROM
THE CHAIRMAN OF THE SOURCE SELECTION ADVISORY COUNCIL DATED APRIL 29,
1971, STATES THAT:
"3. FEASIBILITY OF PERMITTING ALL OFFERORS TO REVISE THEIR TECHNICAL
AND COST PROPOSALS. RAYTHEON, AS THE DEVELOPER OF THE TWT, IS IN
POSSESSION OF THE HIGH DEGREE OF WORKING KNOWLEDGE OF THAT TUBE WHICH IS
NECESSARY TO TRANSLATE ITS EXISTENCE INTO PRACTICAL APPLICATION. IN OUR
JUDGEMENT, SYLVANIA AND GENERAL DYNAMICS COULD NOT BEGIN TO APPROACH
RAYTHEON'S COMPETENCE IN THIS AREA, WHICH IS BASED UPON SOME SEVEN TO
EIGHT YEARS OF EXPERIENCE. WE ARE CONVINCED THAT NO OTHER FIRM COULD
PERFORM THIS TASK WITH THE DEGREE OF CONFIDENCE IN ULTIMATE SUCCESS,
BOTH TECHNICALLY AND COST-WISE, AND AS QUICKLY AS RAYTHEON PRESENTLY
CAN. THIS SYSTEM SHOULD BE AS RELIABLE AS THE STATE OF THE ART PERMITS
IN ORDER TO MINIMIZE DOWN-TIME. IN OUR JUDGEMENT, THIS CAN BEST BE DONE
BY RAYTHEON BECAUSE OF ITS EXPERIENCE.
"4. NEED. THE SYSTEM SHOULD BE DEVELOPED, FABRICATED, AND INSTALLED
AS QUICKLY AS POSSIBLE IN ORDER TO MINIMIZE COST, BOTH TANGIBLE AND
INTANGIBLE, RESULTING FROM INTERFERENCE WITH THE RECIPIENT SHIPS'
OPERATIONAL SCHEDULES. ITS URGENCY IS CONTINUING IN NATURE." MOREOVER,
IT IS URGED THAT NAVAIR'S JUDGMENT MUST BE VIEWED IN LIGHT OF THE
URGENCY OF OBTAINING THE COHERENT RADAR SYSTEM (CRS).
IN REPLY, BOTH SYLVANIA AND GENERAL DYNAMICS MAINTAINS THAT GENERAL
ELECTRIC, NOT RAYTHEON, IS IN THE BEST POSITION TO SATISFY CRS
REQUIREMENTS BY VIRTUE OF ITS EXPERIENCE IN THE DESIGN AND DEVELOPMENT
OF THE PERIMETER ACQUISITION RADAR (PAR) FOR WHICH RAYTHEON DEVELOPED
THE TWT NOW PROPOSED FOR THE CRS SYSTEM. EACH URGES THAT WITH GENERAL
ELECTRIC AS ITS SUBCONTRACTOR IT CAN DELIVER THE CRS SYSTEM SOONER THAN
REQUIRED, EVEN ACCOUNTING FOR ANY DELAY NECESSITATED BY RESOLICITATION.
SPECIFICALLY, GENERAL DYNAMICS STATES IN ITS LETTER OF MAY 5, 1971, THAT
IT IS POSSIBLE TO SHORTEN DELIVERY BY TWO OR MORE MONTHS.
SINCE, AS COUNSEL FOR SYLVANIA CORRECTLY OBSERVES, NAVAIR'S POSITION
IS, IN EFFECT, A SOLE-SOURCE DETERMINATION, CONDITIONED WE MIGHT ADD BY
THE URGENCY OF OBTAINING THE CRS SYSTEM, WE INFORMALLY REQUESTED THAT
NAVAIR REASSESS ITS POSITION IN LIGHT OF THE REPRESENTATIONS MADE BY
SYLVANIA AND GENERAL DYNAMICS. BY LETTER DATED MAY 14, 1971, WE WERE
FURNISHED A COPY OF AN AMENDED DETERMINATION & FINDINGS (D&F), EXECUTED
ON MAY 14, 1971, BY THE ASSISTANT COMMANDER FOR CONTRACTS, NAVAIR, IN
HIS CAPACITY AS CONTRACTING OFFICER, WHICH CITES THE PUBLIC EXIGENCY
NEGOTIATION AUTHORITY OF 10 U.S.C. 2304 (A) (2) IN PREFERENCE TO THE
AUTHORITY OF 10 U.S.C. 2304 (A) (10) TO NEGOTIATE WHEN IT IS
IMPRACTICABLE TO OBTAIN COMPETITION. THE D & F PROVIDES IN PERTINENT
PART, AS FOLLOWS:
"2. (U) THIS PROCUREMENT WAS INITIATED PURSUANT TO THE AUTHORITY OF
SECRETARIAL D&F NO. 0695-70 IN APRIL 1970. THE CIRCUMSTANCES
SURROUNDING THIS PROCUREMENT HAVE SO RADICALLY CHANGED SINCE THAT TIME
THAT THE SAID D&F NO LONGER ACCURATELY REFLECTS AND DEPICTS THE MOST
COGENT REASONS FOR NEGOTIATING THE PROPOSED CONTRACT, AS MEASURED BY THE
CRITERIA SET FORTH IN 10 U.S.C. 2304(A).
"4. (U) THE TECHNICAL APPROACH WHICH WAS PROPOSED BY THE RAYTHEON
COMPANY, KNOWN AS THE TRAVELING WAVE TUBE (TWT) APPROACH, UTILIZES
TRANSMITTER TECHNIQUES AND COMPONENTS, INCLUDING TRANSMITTER TUBES OF
THE TRAVELING WAVE VARIETY, WHICH HAVE BEEN PREVIOUSLY DEVELOPED AND
PRODUCED.
IN ADDITION, THE PARTICULAR TRANSMITTER TUBE PROPOSED BY THE RAYTHEO
COMPANY, IN COMBINATION WITH ITS PROPOSED TRANSMITTER, OFFERS UNIQUE
ADVANTAGES TO THE PROPOSED COHERENT RADAR SYSTEM, SUCH AS LOWER RISK,
HIGHER MTBF AND LONGER SERVICE LIFE THAN OTHER PROPOSED TECHNICAL
APPROACHES.
"5. (U) THERE IS AT PRESENT ONLY ONE OTHER TRANSMITTER WHICH HAS
BEEN DESIGNED TO INCORPORATE THE PARTICULAR TWT TUBE OFFERED BY
RAYTHEON. THAT TRANSMITTER IS KNOWN AS THE PAR-TWT TRANSMITTER AND IT
IS MANUFACTURED BY THE GENERAL ELECTRIC COMPANY. THE COGNIZANT NAVAL
AIR SYSTEMS COMMAND (NAVAIR) TECHNICAL PERSONNEL HAVE CONSIDERED THE
PAR-TWT TRANSMITTER, AND HAVE MET WITH REPRESENTATIVES OF THE GENERAL
ELECTRIC COMPANY TO DISCUSS ITS USE. THEY HAVE CONCLUDED THAT THE
PAR-TWT TRANSMITTER AS PRESENTLY CONFIGURED CANNOT BE PHYSICALLY
ACCOMODATED WITHIN THE SPACE AVAILABLE IN THE ARIS SHIPS, AND THAT IF
THE PAR-TWT TRANSMITTER WAS TO BE USED, IT WOULD ACCORDINGLY BE
NECESSARY TO EXTENSIVELY MODIFY THAT TRANSMITTER. MOREOVER,
REPRESENTATIVES OF THE GENERAL ELECTRIC COMPANY HAVE STATED THAT PAR-TWT
TRANSMITTERS WOULD NOT BE AVAILABLE UNTIL SOME TWELVE (12) TO FOURTEEN
(14) MONTHS AFTER RECEIPT OF A CONTRACT, AND THEN ONLY IF THOSE
TRANSMITTERS WERE TO BE DELIVERED IN THEIR PRESENT CONFIGURATION.
BECAUSE OF THESE FACTORS, THE COGNIZANT NAVAIR TECHNICAL PERSONNEL ARE
OF THE OPINION THAT ANY OFFEROR WHO MIGHT UTILIZE THE GENERAL ELECTRIC
PAR-TWT TRANSMITTER TECHNICAL APPROACH WOULD NEED AT LEAST SIX (6)
MONTHS MORE THAN RAYTHEON TO COMPLETE THE TASK. MOREOVER, IT IS MOST
CONSERVATIVELY ESTIMATED THAT AN ADDITIONAL THREE MONTHS WOULD PASS
BEFORE A CONTRACT COULD BE AWARDED TO ANY OFFEROR IF THIS PROCUREMENT
SHOULD BE RECYCLED SO AS TO AFFORD THE OPPORTUNITY TO THOSE WHO MIGHT
WISH TO PROPOSE THE GENERAL ELECTRIC PAR-TWT TECHNICAL APPROACH."
IN VIEW OF THIS DETERMINATION, WE WILL INTERPOSE NO LEGAL OBJECTION
TO THE AWARD OF A CONTRACT TO RAYTHEON UNDER THE SUBJECT REQUEST FOR
QUOTATIONS.
B-171965, MAY 20, 1971
BID PROTEST - CANCELLED IFB - REDUCED REQUIREMENTS
DECISION DENYING PROTEST AGAINST THE REJECTION OF BIDS CANCELLATION
OF THE SOLICITATION AND SUBSEQUENT READVERTISEMENT BY THE GOVERNMENT
PRINTING OFFICE FOR ORDERS OF PUBLICATIONS REQUIRING LOOSELEAF OR SIDE
STITCHING.
WHERE BIDS WERE TO BE EVALUATED ON THE UNITS OF PRODUCTION WHICH
REPRESENTED THE ESTIMATED REQUIREMENTS FOR ONE MONTH AND IT WAS
DISCOVERED AFTER BID OPENING THAT THE ESTIMATE OF 675,000 HAD BEEN
ACTUALLY ESTIMATED AT 67,500 WHICH WAS SUBSEQUENTLY REDUCED TO 9,000 THE
LAW REQUIRES ADVERTISING THE ACTUAL WORK TO BE PERFORMED AND
CANCELLATION OF THE INVITATION IS THEREFORE PROPER.
TO FEDERAL LITHOGRAPH COMPANY:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 19, 1971, WITH
ENCLOSURES, PROTESTING THE REJECTION OF ALL BIDS AND CANCELLATION OF THE
SOLICITATION FOR TECHNICAL PUBLICATIONS, PROGRAM 66-M, CATEGORY 3, AND
THE SUBSEQUENT READVERTISEMENT OF THAT CATEGORY BY THE GOVERNMENT
PRINTING OFFICE (GPO).
THE INVITATION REQUESTED PROPOSALS FOR THE PRINTING AND BINDING OF
TECHNICAL PUBLICATIONS AS REQUISITIONED FROM THE GPO BY THE DEPARTMENT
OF THE NAVY. IT WAS DIVIDED INTO THREE CATEGORIES OF WORK TO BE
PERFORMED DURING THE PERIOD FROM FEBRUARY 1, 1971, THROUGH JANUARY 31,
1972. CATEGORY 3, IN ISSUE HERE, PROVIDED FOR ORDERS OF PUBLICATIONS UP
TO 500 PAGES, IN QUANTITIES OF 500 TO 5000 COPIES, REQUIRING LOOSELEAF
OR SIDE STITCHING. THE INVITATION FURTHER PROVIDED FOR MULTIPLE AWARDS
IN EACH CATEGORY OF THE PROGRAM SINCE IT WAS ANTICIPATED THAT ONE FIRM
MIGHT NOT BE ABLE TO MEET ALL THE REQUIREMENTS. UNDER THIS PROCEDURE
THE GOVERNMENT IS OBLIGATED TO OFFER EACH ORDER TO THE LOW OFFEROR IN
THE CORRESPONDING CATEGORY FIRST, THE NEXT LOW OFFEROR SECOND, AND SO ON
UNTIL THE ORDER IS ACCEPTED. THE ONLY VALID REASON FOR DECLINING AN
OFFER IS THE CONTRACTOR'S INABILITY TO MEET THE SHIPPING SCHEDULE. BIDS
WERE TO BE EVALUATED UPON THE UNITS OF PRODUCTION SET OUT IN THE
PROVISION ENTITLED "METHOD OF DETERMINING AWARD - BASIS OF AWARD" WHICH
REPRESENTED THE ESTIMATED REQUIREMENTS FOR ONE MONTH.
UNDER PARAGRAPH XV(1), CATEGORY 3, THE INVITATION REQUESTED PRICES
FOR "BANDING: INDIVIDUAL BOOKS - PER 100 BOOKS - $___." YOUR FIRM
SUBMITTED A BID FOR THIS ITEM OF 5 CENTS PER HUNDRED BOOKS. ON THE
PRICING SCHEDULE THE BIDS FOR THIS ITEM RANGED FROM A UNIT RATE OF
$10.00 TO $3.00 PER HUNDRED WITH THE EXCEPTION OF TWO BIDS, YOURS AT 5
CENTS AND ONE OTHER AT 10 CENTS PER HUNDRED BOOKS. THESE BIDS WERE
BASED UPON THE BANDING OF 6,750 HUNDREDS, OR 675,000 BOOKS. HOWEVER,
IMMEDIATELY AFTER BID OPENING ON JANUARY 25, 1971, IT WAS DISCOVERED
THAT THE SPECIFIED QUANTITY OF 6,750 HUNDREDS, WHICH WAS USED IN THE
BIDDING WAS IN ERROR AND THAT THIS QUANTITY HAD BEEN ACTUALLY ESTIMATED
AS 675 HUNDREDS OR 67,500. AT THIS TIME IT WAS ALSO DETERMINED THAT THE
REQUIREMENT FOR STITCHING HAD BEEN OMITTED UNDER ITEM XV WHICH SHOULD
HAVE BEEN STATED AS FOLLOWS:
"8(A). 2 SIDE WIRE STITCHES - PER 100 BOOKS $___
(B). 1 STITCH UPPER LEFT CORNER - PER 100 BOOKS $___."
DUE TO THE ABOVE ERRORS IT WAS DETERMINED THAT ALL BIDS AS TO
CATEGORY 3 WOULD BE REJECTED, AND THAT CORRECTIONS SHOULD BE MADE IN A
RESOLICITATION OF BIDS ON THAT CATEGORY. IT WAS ALSO SUBSEQUENTLY
DETERMINED THAT THE ORIGINAL ESTIMATE OF 67,500 BOOKS REQUIRING BANDING
WAS TOO HIGH AND THAT THE ESTIMATE SHOULD BE REDUCED TO 90 HUNDREDS OR
9,000 BOOKS. ACCORDINGLY, THE READVERTISEMENT FOR BIDS WAS ANNOUNCED ON
FEBRUARY 16, 1971, AND INVITATIONS FOR BIDS WERE ISSUED TO ALL PRIOR
BIDDERS.
YOU PROTESTED THE REJECTION OF ALL BIDS FOR CATEGORY 3, AND
READVERTISING OF A NEW PROCUREMENT OF THIS CATEGORY. YOU STATE THAT "
*** ONCE THIS COMPANY'S PRICES ARE MADE PUBLIC INFORMATION WE FEEL THAT
A REBID OF THIS NATURE IS UNFAIR TO US SINCE THERE WAS ONLY ONE CHANGE
AND TWO ADDITIONAL PRICES REQUESTED." YOU ASK " *** WOULD IT NOT SEEM
REASONABLE TO LET ALL OF THE OTHER PRICES STAND AS IN THE ORIGINAL BID
OPENING AND ONLY ASK FOR A REBID OF THE ONE ITEM OF BANDING WITH A NEW
BASIS OF AWARD AND NEW PRICES FOR THE TWO SMALL ITEMS OF STAPLING *** ."
IT IS ADMINISTRATIVELY REPORTED THAT THE REQUIREMENT FOR BANDING IS
CONSIDERED TO BE AN INSEPARABLE PART OF THE WORK REQUIRED IN CATEGORY 3.
FURTHER, CANCELLATION OF THE INVITATION FOR CATEGORY 3 IS REQUIRED
BECAUSE THE ESTIMATE SHOWN IN THE INVITATION FOR BANDING HAD NO
RELATIONSHIP TO THE ACTUAL WORK EXPECTED TO BE AWARDED, AND AN
EVALUATION ON THE CURRENT BEST ESTIMATE IN ACCORDANCE WITH THE BASIS OF
AWARD WOULD CHANGE THE RELATIVE STANDING OF THE BIDS. ADDITIONALLY, GPO
ADVISES THAT TO NEGOTIATE OR ADVERTISE FOR PRICES FOR BANDING AND
STITCHING ALONE, WITH THE PRICES ON OTHER ITEMS IN CATEGORY 3 HAVING
BEEN MADE PUBLIC, WOULD ONLY RESULT IN UNBALANCED PRICES ON THESE ITEMS
TO CHANGE THE BIDDERS' OVERALL EVALUATED POSITIONS FOR CATEGORY 3. IT
IS THE FURTHER CONCLUSION OF THE GPO THAT IT COULD NOT CONSIDER A
REAFFIRMATION OF YOUR PRICE FOR THE ITEM OF BANDING UNDER THE REVISED
ESTIMATE BECAUSE (1) THE PRICES OFFERED BY ALL BIDDERS WERE BASED UPON A
REQUIREMENT NEVER INTENDED OR POSSIBLE OF FULFILLMENT AND (2) TO DO SO
WOULD REQUIRE NEGOTIATIONS WITH THE OTHER BIDDERS UPON THE BASIS OF THE
BEST ESTIMATE OF THE NUMBER OF BOOKS TO BE BANDED.
INFORMATION AS TO ESTIMATED TOTAL QUANTITIES OF WORK IS IMPORTANT FOR
A PROPER EVALUATION OF BIDS. BY USING ESTIMATED QUANTITIES FOR BID
EVALUATION WHICH ARE DIFFERENT FROM ACTUAL ANTICIPATED NEEDS, THE
POSSIBILITY ARISES THAT A BIDDER MAY BE FOUND LOW ON EVALUATION WHO IS
NOT THE LOWEST BIDDER ON THE REAL REQUIREMENTS, OR THE BEST ESTIMATE
THEREOF. 42 COMP. GEN. 257, 260 (1962). WHERE A REQUIREMENTS TYPE
CONTRACT IS CONTEMPLATED BY AN AGENCY, THE COURTS AND OUR OFFICE HAVE
HELD THAT SUCH CONTRACTS ARE VALID PROVIDED THAT THE ESTIMATE OF THE
PROBABLE AMOUNT OF GOODS OR SERVICES TO BE GENERATED WAS DETERMINED IN
GOOD FAITH. SEE 47 COMP. GEN. 365 (1968) AND 37 ID. 688 (1958).
THE SITUATION HEREIN BEARS SOME ANALOGY TO THAT IN OUR DECISION
B-145109, MAY 1, 1961, WHERE AFTER BID OPENING BUT BEFORE AWARD, THE
PROCURING ACTIVITY PROPOSED THREE SIGNIFICANT CHANGES IN THE CONTRACT
SPECIFICATIONS. THE PROCURING ACTIVITY REQUESTED OUR ADVICE AS TO
WHETHER AWARD COULD BE MADE TO THE LOW BIDDER UNDER THE ADVERTISED
SPECIFICATIONS AND THE CHANGES NEGOTIATED AFTER AWARD, OR WHETHER THE
PROCUREMENT SHOULD BE READVERTISED UNDER SPECIFICATIONS INCORPORATING
THE THREE PROPOSED CHANGES. IN HOLDING THAT READVERTISEMENT WAS
REQUIRED, WE SAID:
"THE RULE, WHICH IS EQUALLY APPLICABLE TO COMPETITIVE PROCUREMENTS
UNDER 10 U.S.C. 2304(A), HAS BEEN CONSISTENTLY FOLLOWED. SEE 39 COMP.
GEN. 566 (1960), AND 30 COMP. GEN. 34 (1950). THE RULE APPLIES WHETHER
THE WORK IS TO BE INCREASED OR DECREASED. ***
" *** WHERE A CONTRACT IS REQUIRED TO BE AWARDED PURSUANT TO
COMPETITIVE BIDDING, THE LOW BID MUST BE DETERMINED ON THE BASIS OF BIDS
ON THE WORK ACTUALLY TO BE PERFORMED, NOT ON THE BASIS OF BIDS ON
SPECIFICATIONS KNOWN TO CALL FOR MORE OR LESS WORK, OR WORK OF A
DIFFERENT TYPE. THE ONLY PROPER WAY TO DETERMINE THE LOWEST BIDDER IS
BY ADVERTISING THE ACTUAL WORK TO BE PERFORMED, AND THIS, IN OUR
OPINION, IS WHAT THE LAW REQUIRES. 17 COMP. GEN. 427, 430 (1937); 15
ID. 573, 576 (1935). SEE ALSO 11 COMP. GEN. 183, 184, (1931). THE
ADOPTION OF ANY OTHER VIEW WOULD PERMIT CIRCUMVENTION OF THE COMPETITIVE
BID REQUIREMENT AND WOULD BE CONTRARY TO THE INTENT OF THE PROCUREMENT
STATUTES."
THE PRIMARY PURPOSE OF PROCUREMENT THROUGH FORMAL ADVERTISING BY
GOVERNMENT AGENCIES IS TO GIVE ALL BIDDERS AN EQUAL OPPORTUNITY TO
COMPETE FOR GOVERNMENT BUSINESS AND TO SECURE TO THE UNITED STATES THE
BENEFIT OF FREE AND OPEN COMPETITION. REJECTION OF ALL BIDS IS
APPROPRIATE WHERE IT IS DETERMINED THAT REJECTION IS IN THE PUBLIC
INTEREST. OUR OFFICE HAS CONSISTENTLY HELD THAT, WHILE THE INTEREST OF
THE GOVERNMENT AND THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM
REQUIRE THAT INVITATIONS BE CANCELLED ONLY FOR THE MOST COGENT REASONS,
THERE NECESSARILY IS RESERVED IN THE CONTRACTING OFFICIALS A SUBSTANTIAL
AMOUNT OF DISCRETION ON DETERMINING WHETHER OR NOT AN INVITATION SHOULD
BE CANCELLED. WE WILL, THEREFORE, NOT OBJECT TO THE CANCELLATION OF AN
INVITATION UNLESS THERE HAS BEEN A CLEAR SHOWING OF ABUSE OF
ADMINISTRATIVE DISCRETION. SEE B-165206, JANUARY 8, 1969, B-164520,
SEPTEMBER 24, 1968, B-162382, MAY 17, 1968, B-159287, JULY 26, 1966.
ON THE PRESENT RECORD WE MUST CONCLUDE THAT THERE HAS BEEN NO SUCH
ABUSE OF DISCRETION IN THE INSTANT CASE. IT IS A WELL-ESTABLISHED
PRINCIPLE OF PROCUREMENT BY FORMAL ADVERTISING THAT A CONTRACT SHOULD BE
AWARDED TO THAT RESPONSIVE, RESPONSIBLE BIDDER OFFERING THE MOST
ADVANTAGEOUS BID, PRICE AND OTHER FACTORS CONSIDERED. IT IS AXIOMATIC
THAT IN ORDER TO OBSERVE THIS BASIC PRINCIPLE, BIDS BE EVALUATED AS
NEARLY AS POSSIBLE IN LIGHT OF THE ANTICIPATED NEEDS AND THE COSTS
ULTIMATELY TO BE BORNE BY THE PROCURING ACTIVITY.
ACCORDINGLY, IT IS OUR OPINION THAT CANCELLATION OF THE ORIGINAL
INVITATION FOR CATEGORY 3 WAS PROPER, AND YOUR PROTEST IS THEREFORE
DENIED.
B-172099, MAY 20, 1971
BID PROTEST - BIDDER RESPONSIBILITY - BID RESPONSIVENESS
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST AWARD OF A
CONTRACT TO LOW BIDDER, BERKIN EXHAUST CLEANING ENGINEERS, UNDER AN IFB
ISSUED BY KINCHELOE AFB, MICHIGAN, FOR INSPECTION, REPAIR AND CLEANING
OF FURNACES AND DUCTING IN HOUSING UNITS.
A PREAWARD SURVEY ESTABLISHED THAT SUCCESSFUL BIDDER WAS RESPONSIBLE
WITHIN THE MEANING OF ASPR 1-903.1 AND THE FINDINGS OF THE CONTRACTING
AGENCY WILL BE ACCEPTED EXCEPT IN CIRCUMSTANCES NOT HERE APPLICABLE.
ALSO BERKIN PROPERLY COMPLETED THE BID FORM INCLUDING THE SMALL BUSINESS
THE SUBJECT SOLICITATION REQUIRED THE PROSPECTIVE CONTRACTOR TO
INSPECT, REPAIR AND CLEAN FURNACES AND DUCTING IN HOUSING UNITS AT THE
BASE.
IT WAS ESTABLISHED, UPON BID OPENING, THAT BERKIN WAS LOW BIDDER WITH
A PRICE OF $22,994.00, FOLLOWED BY YOUR BID OF $23,933.33.
YOUR PROTEST IS PREDICATED UPON THE ALLEGATION THAT BERKIN'S
EXPERIENCE HAS BEEN LIMITED TO THE FUNCTION OF CLEANING FURNACES; THEY
ARE DEVOID OF PRIOR EXPERIENCE IN THE REALM OF MAINTENANCE INSPECTION OR
REPAIR; THEY ARE INCAPABLE OF FULFILLING THE MINIMUM STANDARDS OF
RESPONSIBILITY UNDER ARMED SERVICES PROCUREMENT REGULATION (ASPR)
1-903.1; AND THEY FAIL TO POSSESS THE REQUISITE ORGANIZATION,
EXPERIENCE, TECHNICAL EQUIPMENT, TECHNICAL SKILLS, PRODUCTION CONTROL OR
QUALITY ASSURANCE TO PERFORM AS A RESPONSIBLE CONTRACTOR PURSUANT TO
ASPR 1-903.2(A). IT IS FURTHER CONTENDED THAT BERKIN'S BID SHOULD HAVE
BEEN DECLARED NONRESPONSIVE FOR FAILURE TO COMPLETE THE SMALL BUSINESS
REPRESENTATION SECTION OF THE BID.
AN EXAMINATION OF THE RECORD REVEALS DOCUMENTS, SOLICITED FROM THE
PROCUREMENT PERSONNEL AT GOVERNMENT INSTALLATIONS AT WHICH BERKIN HAS
RECENTLY PERFORMED CONTRACTS OF A SIMILAR NATURE, EXPRESSING UNQUALIFIED
SATISFACTION WITH THAT FIRM'S PERFORMANCE. IT IS NOTED, SIGNIFICANTLY,
THAT SEVERAL OF THESE CONTRACTS REQUIRED THE PERFORMANCE OF REPAIRS.
FOR THE INSTANT PROCUREMENT, A PREAWARD SURVEY WAS PERFORMED IN WHICH
BERKIN WAS EXAMINED FOR:
(1) TECHNICAL CAPABILITY
(2) PRODUCTION CAPABILITY
(3) PLANT FACILITIES AND EQUIPMENT
(4) FINANCIAL CAPABILITY
(5) PLANT SAFETY
(6) LABOR RESOURCE
(7) PERFORMANCE RECORD
(8) ABILITY TO MEET REQUIRED SCHEDULE
UPON RECEIPT OF A SATISFACTORY RATING IN EACH OF THESE CATEGORIES,
BERKIN WAS DETERMINED TO BE A RESPONSIBLE PROSPECTIVE CONTRACTOR WITHIN
THE MEANING OF ASPR 1-903.1 AND WAS RECOMMENDED FOR AWARD ON MARCH 23,
1971.
WE HAVE CONSISTENTLY HELD THAT WHETHER A BIDDER IS CAPABLE OF
PERFORMING IN ACCORDANCE WITH CONTRACT REQUIREMENTS IS A QUESTION OF
FACT, REQUIRING THE EXERCISE OF CONSIDERABLE JUDGMENT BY AGENCY
PERSONNEL, AND IN THE ABSENCE OF EVIDENCE THAT A DETERMINATION OF A
BIDDER'S CAPABILITIES WAS ARBITRARY OR BASED ON ERROR, FRAUD, OR
FAVORITISM, WE WILL ACCEPT THE FINDING OF THE CONTRACTING AGENCY. THE
DETERMINATION BY THE CONTRACTING OFFICER THAT BERKIN IS A RESPONSIBLE
CONTRACTOR IS SUPPORTED BY AN AFFIRMATIVE PREAWARD SURVEY, AND THE
RECORD PROVIDES NO BASIS FOR THIS OFFICE TO QUESTION THE SURVEY FINDINGS
OR THE AGENCY'S DECISION THAT BERKIN CAN SATISFACTORILY PERFORM THE
CONTRACT REQUIREMENTS. 46 COMP. GEN. 371 (1966).
YOU HAVE IMPLIED THAT AN AWARD TO BERKIN WOULD JEOPARDIZE THE LIVES
AND WELL-BEING OF THE INVOLVED BUILDINGS' OCCUPANTS. IN THIS REGARD, IT
IS THE POSITION OF OUR OFFICE THAT THE CONTRACTING OFFICIALS ARE IN THE
BEST POSITION TO ASSESS RESPONSIBILITY, AND THE RECORD INDICATES THAT
THE WELFARE OF THE PERSONNEL IN THE HOUSING UNITS WAS FULLY CONSIDERED
BY THE AGENCY IN DECIDING THAT BERKIN WAS SAFETY CONSCIOUS AND COMPETENT
TO PERFORM THE WORK.
TO VENTILATION CLEANING ENGINEERS, INC.:
REFERENCE IS MADE TO YOUR LETTERS OF MARCH 5 AND APRIL 22, 1971,
PROTESTING THE PROPOSED AWARD OF A CONTRACT TO BERKIN EXHAUST CLEANING
ENGINEERS (BERKIN) PURSUANT TO INVITATION FOR BIDS F20612-71-B-0771-M02
ISSUED DECEMBER 9, 1970, BY THE KINCHELOE AIR FORCE BASE, MICHIGAN.
WITH REGARD TO YOUR CONTENTION THAT BERKIN WAS NONRESPONSIVE TO THE
IFB
B-172119, MAY 20, 1971
RETROACTIVE PAY ADJUSTMENT - PHOTOENGRAVER
REGARDING RETROACTIVE PAY ADJUSTMENT REQUESTED BY THE PHOTOENGRAVERS
AT THE GOVERNMENT PRINTING OFFICE AND APPROVED BY JOINT COMMITTEE ON
PRINTING. AS 44 U.S.C. 305 PROVIDES THAT WAGE DETERMINATIONS ARE NOT
SUBJECT TO CHANGE MORE OFTEN THAN ONCE A YEAR NEITHER THE PUBLIC PRINTER
NOR THE JOINT COMMITTEE ON PRINTING MAY INCORPORATE FRINGE BENEFITS IN A
CURRENT AGREEMENT SO AS TO AUTHORIZE RETROACTIVE PAY ADJUSTMENTS.
TO MR. SPENCE:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF MARCH 5, 1971, REQUESTING
OUR DECISION AS TO WHETHER THE PUBLIC PRINTER OR THE JOINT COMMITTEE ON
PRINTING IS EMPOWERED TO MAKE A RETROACTIVE PAY ADJUSTMENT REQUESTED BY
THE PHOTOENGRAVERS AT THE GOVERNMENT PRINTING OFFICE.
YOUR LETTER STATES IN PART AS FOLLOWS:
"DURING THE COURSE OF THE 1970-1971 WAGE CONFERENCES CONDUCTED IN
ACCORDANCE WITH THE KIESS ACT (44 U.S.C. 305), THE JOINT COMMITTEE ON
PRINTING RULED THAT CERTAIN FRINGE BENEFITS, NOT THERETOFORE INCLUDED IN
THE WAGE DETERMINATIONS, WERE PROPERLY INCLUDABLE IN THE WAGE FORMULA
APPROVED BY THE JOINT COMMITTEE ON PRINTING IN FEBRUARY 1962 FOR USE BY
THE PUBLIC PRINTER IN CONFERRING WITH CERTAIN TRADES FOR THE PURPOSE OF
ESTABLISHING WAGES UNDER THE KIESS ACT. THIS ADDITIONAL CONSIDERATION
WENT INTO EFFECT IN JUNE 1970 AND WAS INCORPORATED INTO ALL WAGE
AGREEMENTS NEGOTIATED SUBSEQUENT THERETO.
"ALTHOUGH THE PHOTOENGRAVERS HAD COMPLETED WAGE NEGOTIATIONS FOR 1970
AND THE RESULTANT WAGE RATES HAD BEEN APPROVED BY THE JOINT COMMITTEE ON
PRINTING PRIOR TO JUNE 1970, THEY REQUESTED THAT THEIR PAY BE
RETROACTIVELY ADJUSTED TO INCLUDE THE BENEFITS GIVEN TO THE OTHER CRAFTS
INVOLVED."
IN A LETTER TO YOU DATED SEPTEMBER 21, 1970, AND IN REFERENCE TO AN
"ALL CRAFTS" CONFERENCE, THE REPRESENTATIVES OF THE PHOTOENGRAVERS
STATED THEY UNDERSTOOD THAT ALTHOUGH THEY HAD COMPLETED WAGE
NEGOTIATIONS FOR 1970 UNDER YOUR PREDECESSOR, THE HONORABLE JAMES L.
HARRISON, ANY NEW FRINGE BENEFITS THAT WOULD BE INCORPORATED IN LATER
AGREEMENTS WITH THE REMAINING CRAFTS COULD POSSIBLY BE ADDED TO THEIR
WAGES RETROACTIVELY. IN ADDITION, IT WAS ACKNOWLEDGED THEREIN THAT YOU
INDICATED THIS WOULD NECESSARILY BE GOVERNED BY LAW AND THAT THEY COULD
EXPECT THESE FRINGE BENEFITS TO BE ADDED IF PRACTICABLE.
YOU REQUEST OUR DECISION SINCE 44 U.S.C. 305 PROVIDES THAT WAGES,
SALARIES AND COMPENSATION DETERMINED UNDER SUCH SECTION ARE NOT SUBJECT
TO CHANGE OFTENER THAN ONCE A YEAR.
THE CITED STATUTE PROVIDES GENERALLY THAT THE RATE OF WAGES,
INCLUDING COMPENSATION FOR NIGHT AND OVERTIME WORK, FOR MORE THAN TEN
EMPLOYEES OF THE SAME OCCUPATION SHALL BE DETERMINED BY A CONFERENCE
BETWEEN THE PUBLIC PRINTER AND A COMMITTEE SELECTED BY THE TRADES
AFFECTED, AND THE RATES AND COMPENSATION SO AGREED UPON SHALL BECOME
EFFECTIVE UPON APPROVAL BY THE JOINT COMMITTEE ON PRINTING. IN THE
INSTANT CASE THE WAGES OF THE PHOTOENGRAVERS WERE APPROVED BY THE JOINT
COMMITTEE PRIOR TO JUNE 1970, THE DATE THE FRINGE BENEFITS WERE TAKEN
INTO CONSIDERATION AND INCORPORATED INTO AGREEMENTS NEGOTIATED
SUBSEQUENT THERETO.
IN VIEW OF THE ABOVE AND SINCE 44 U.S.C. 305 PROVIDES THAT THE WAGE
DETERMINATIONS ARE NOT SUBJECT TO CHANGE OFTENER THAN ONCE A YEAR,
NEITHER THE PUBLIC PRINTER NOR THE JOINT COMMITTEE ON PRINTING MAY AT
THIS TIME INCORPORATE THE FRINGE BENEFITS IN THE CURRENT AGREEMENT SO AS
TO AUTHORIZE THE REQUESTED RETROACTIVE PAY ADJUSTMENTS. SEE 46 COMP.
GEN. 346 (1966).
B-172240, MAY 20, 1971
BID PROTEST - DAVIS BACON ACT REINSTATED
DECISION DENYING PROTEST AGAINST CANCELLATION OF AN IFB AND ANY AWARD
UNDER THE RESOLICITATION ISSUED BY THE ARMY ENGINEER DISTRICT, FORT
WORTH, TEXAS, INCIDENT TO THE SUSPENSION AND REINSTATEMENT OF THE
DAVIS-BACON ACT.
THE PRESIDENTIAL PROCLAMATION OF MARCH 29, 1971, REINSTATED THE
DAVIS-BACON ACT PROVISIONS, BUT ONLY AS TO CONTRACTS FOR WHICH
SOLICITATIONS WERE ISSUED AFTER THAT DATE. THEREFORE, THE INSTANT
PROCUREMENT RESOLICITED WHILE THE PROVISIONS WERE SUSPENDED NEED NOT BE
REVOKED AND AN AWARD THEREUNDER WILL BE PROPER.
TO KEMP, SMITH, WHITE, DUNCAN & HAMMOND:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED APRIL 27, 1971,
WRITTEN ON BEHALF OF ROBERT E. MCKEE, INC., IN WHICH YOU REAFFIRM YOUR
PROTEST AGAINST THE CANCELLATION OF INVITATION FOR BIDS NO.
DACA63-71-B-0074, ISSUED BY THE UNITED STATES ARMY ENGINEER DISTRICT,
FORT WORTH, TEXAS, AND AGAINST THE RESOLICITATION OF BIDS UNDER IFB NO.
DACA63-71-B-0161. YOU STATE THAT IN VIEW OF THE MARCH 29, 1971,
PROCLAMATION OF THE PRESIDENT OF THE UNITED STATES REINSTATING THE
PROVISIONS OF THE DAVIS-BACON ACT AN AWARD BASED UPON BIDS RECEIVED
UNDER IFB NO. DACA63-71-B-0161 WOULD BE IMPROPER, AND YOU DEMAND THAT
ALL BIDS SUBMITTED PURSUANT TO THE READVERTISEMENT BE REJECTED.
PRESIDENTIAL PROCLAMATION 4040 DATED MARCH 29, 1971, REVOKED
PROCLAMATION 4031 AND EFFECTIVELY REINSTATED THE DAVIS-BACON ACT, 40
U.S.C. 276A, BUT ONLY AS TO CONSTRUCTION CONTRACTS FOR WHICH
SOLICITATIONS FOR BIDS OR PROPOSALS WERE ISSUED AFTER MARCH 29, 1971. A
COPY OF PROCLAMATION 4040 IS ENCLOSED. A MEMORANDUM DATED MARCH 30,
1971, COPY ALSO ENCLOSED, FROM THE ASSISTANT SECRETARY OF DEFENSE,
INSTALLATIONS AND LOGISTICS, IMPLEMENTS THE PROCLAMATION AND SETS OUT
PROCEDURES TO BE FOLLOWED WITH RESPECT TO INVITATIONS WHICH HAD BEEN
ISSUED DURING THE SUSPENSION OF THE DAVIS-BACON ACT.
BY ITS TERMS, PROCLAMATION 4040 DOES NOT SPECIFICALLY REQUIRE CHANGES
IN PENDING PROCUREMENT ACTIONS OR CONTRACT PROCEDURES WITH RESPECT
THERETO WHICH WERE INITIATED PRIOR TO THE REVOCATION OF THE SUSPENSION.
CONTRACTS ENTERED INTO WITHOUT DAVIS-BACON PROVISIONS BECAUSE THE
SOLICITATIONS WERE ISSUED DURING THE PERIOD BETWEEN FEBRUARY 23 AND
MARCH 29, 1971, INCLUSIVE, MAY REMAIN FREE OF SUCH PROVISIONS,
IRRESPECTIVE OF THE DATE THEY ARE ENTERED INTO OR THE PERIOD IN WHICH
THEIR PERFORMANCE OCCURS.
IN VIEW OF THE FOREGOING IT IS OUR OPINION THAT REISSUANCE OF THE
PROCUREMENT UNDER IFB-0161 AND AN AWARD THEREUNDER TO THE LOWEST
RESPONSIBLE, RESPONSIVE BIDDER WOULD NOT VIOLATE EITHER OF THE
PRESIDENTIAL PROCLAMATIONS, OR THE REGULATIONS ISSUED IN IMPLEMENTATION
THEREOF. IN THIS CONNECTION, WE ARE ENCLOSING A COPY OF A MEMORANDUM
DATED MAY 7, 1971, FROM THE ACTING ASSISTANT SECRETARY OF DEFENSE
SETTING OUT PROCEDURES TO BE FOLLOWED BY THE MILITARY DEPARTMENTS WHICH
ARE IN ACCORD WITH THE FOREGOING. WE THEREFORE SEE NO VALID BASIS ON
WHICH IT MAY BE CONTENDED THAT AN AWARD MUST NOW BE MADE TO ROBERT E.
MCKEE, INC., AS THE LOW BIDDER ON THE ORIGINAL SOLICITATION FOR BIDS, AS
ORIGINALLY CONTENDED BY YOU, OR THAT THE PROCUREMENT IS AGAIN REQUIRED
TO BE READVERTISED DUE TO THE ISSUANCE OF PROCLAMATION 4040.
ACCORDINGLY, YOUR PROTEST MUST BE DENIED.
B-172279, MAY 20, 1971
CIVILIAN EMPLOYEES - REEMPLOYMENT INTERVIEWS - TRAVEL EXPENSES
REGARDING PAYMENT OF TRAVEL AND SUBSISTENCE EXPENSES OF PROSPECTIVE
EMPLOYEES FOR PREEMPLOYMENT INTERVIEWS. WITHOUT STATUTORY
AUTHORIZATION, SUCH EXPENSES MAY NOT BE INCURRED BY THE APPOINTING
OFFICE TO ENABLE HIM TO SELECT AMONG ELIGIBLE APPLICANTS FOR CIVIL
SERVICE POSITIONS.
TO MR. HAMPTON:
THIS REFERS TO YOUR LETTER OF MARCH 17, 1971, IN WHICH YOU SAY THAT
BEFORE PREPARING A LEGISLATIVE PROPOSAL TO PERMIT PAYMENT BY AGENCIES OF
PREEMPLOYMENT INTERVIEW EXPENSES IN FILLING COMPETITIVE POSITIONS YOU
FIRST WHICH TO ASCERTAIN WHETHER OUR OFFICE WOULD RECOGNIZE SUCH
PAYMENTS AS AUTHORIZED WITHOUT SUCH LEGISLATION WHEN THE PURPOSE OF THE
INTERVIEW IS TO ENABLE THE APPOINTING OFFICER TO EXERCISE HIS
RESPONSIBILITY FOR MAKING A SELECTION FROM AMONG THE ELIGIBLE
APPLICANTS.
YOU SAY THAT FOR SOME COMPETIVE POSITIONS AGENCIES FEEL THAT
INTERVIEWS WITH THE ELIGIBLE APPLICANTS ARE ESSENTIAL BEFORE MAKING A
SELECTION. WHEN A STAFFING ACTION HAS REACHED THE AGENCY INTERVIEW
STAGE, THE COMMISSION FUNCTION OF ASCERTAINING QUALIFICATIONS HAS BEEN
COMPLETED. AT THE POINT WHEN AN AGENCY ASKS CERTAIN QUALIFIED
APPLICANTS TO COME IN FOR AN INTERVIEW, THE AGENCY HEAD IS EXERCISING
THE LEGAL RESPONSIBILITY VESTED IN HIM TO MAKE A SELECTION FROM AMONG
VARIOUS APPLICANTS ALREADY IDENTIFIED BY THE COMMISSION AS QUALIFIED.
THIS SELECTION ACTION BY AN AGENCY OFFICIAL IS STATED TO BE A DISCRETE
FUNCTION, READILY DISTINGUISHABLE FROM THE COMMISSION'S FUNCTION OF
SUPPLYING HIM WITH THE NAMES OF QUALIFIED PERSONS FROM AMONG WHOM HE CAN
MAKE HIS SELECTION, AND YOU THEREFORE ASK WHETHER AGENCIES MAY PAY THE
EXPENSES OF TRAVEL IN THESE SITUATIONS.
AS INDICATED IN YOUR LETTER, OUR DECISIONS HAVE NOT AUTHORIZED
PAYMENT OF TRAVELING EXPENSES OF PROSPECTIVE EMPLOYEES FOR PREEMPLOYMENT
INTERVIEWS UNLESS A PARTICULAR AGENCY HAS COMPLETE SELECTION AND
RECRUITMENT AUTHORITY, A FUNCTION NORMALLY REPOSED IN THE CIVIL SERVICE
COMMISSION FOR POSITIONS IN THE COMPETITIVE SERVICE. THE EXCEPTION TO
THE GENERAL RULE AS STATED IN OUR DECISIONS AT 41 COMP. GEN. 482 (1962)
AND 40 ID. 221 (1960), CONCERNS POSITIONS WHICH ARE EXCEPTED FROM THE
COMPETITIVE CIVIL SERVICE OR ARE OTHERWISE NOT SUBJECT TO ALL OF THE
CIVIL SERVICE LAWS AND REGULATIONS GENERALLY.
THE GENERAL RULE WAS APPLIED IN 31 COMP. GEN. 175 (1951) TO A
SITUATION SUCH AS EXPLAINED IN YOUR LETTER. IN THAT CASE ONE OF THE
SPECIFIC QUESTIONS WAS "MAY THE DEPARTMENT PAY THE TRAVEL AND
SUBSISTENCE EXPENSES OF INDIVIDUALS WHO ARE REACHED ON CIVIL SERVICE
REGISTERS IN ORDER TO INTERVIEW THEM AT THE APPROPRIATE HEADQUARTERS
OFFICE *** ?" ALTHOUGH NOT RESTATED IN THE PUBLISHED DECISION, THE
DEPARTMENT OF AGRICULTURE IN ITS REQUEST FOR THE DECISION POINTED OUT
THAT THE INTERVIEW OF PERSONS DESIRED TO BE CONSIDERED FOR EMPLOYMENT
WAS NOT DESIGNED TO DETERMINE QUALIFICATIONS OF APPLICANTS FOR FEDERAL
EMPLOYMENT OR OTHER MATTERS WITHIN THE SCOPE OF AUTHORITY OF THE CIVIL
SERVICE COMMISSION. THEREFORE, SINCE THE PURPOSE WAS FOR THE SELECTION
OF QUALIFIED APPLICANTS, THE SITUATION THERE IS SIMILAR TO THE SITUATION
EXPLAINED IN YOUR LETTER AND UPON WHICH YOU REQUEST AN OPINION. WE FIND
NO BASIS TO DEPART FROM THE GENERAL RULE THAT TRAVEL EXPENSES IN SUCH
SITUATIONS MAY NOT BE PAID BY THE AGENCIES CONCERNED IN THE ABSENCE OF
SPECIFIC STATUTORY AUTHORITY THEREFOR. IN THAT CONNECTION WE NOTE THAT
THE CONGRESS IN THE PAST HAS DECLINED TO ENACT LEGISLATION AUTHORIZING
EXPENSES FOR INTERVIEWS OF PROSPECTIVE EMPLOYEES SUCH AS HERE INVOLVED.
SEE SENATE REPORT NO. 2185, 85TH CONGRESS ON H.R. 11133. COMPARE HOUSE
REPORT NO. 881, ON H.R. 9382, 90TH CONGRESS, 1ST SESSION. ALSO, SEE S.
1770 AND S. 2275, 91ST CONGRESS, 1ST SESSION.
B-171600, MAY 19, 1971
BID PROTEST - SUBCONTRACTS - BRAND NAME OR EQUAL
DECISION DENYING PROTEST AGAINST AWARD OF A SUBCONTRACT FOR THREE
SHIPSETS OF AN ANCHOR HANDLING SYSTEM TO BALDT ANCHOR AND CHAIN UNDER A
SOLICITATION ISSUED BY INGALLS WEST DIVISION OF LITTON INDUSTRIES, PRIME
CONTRACTOR WITH THE DEPARTMENT OF THE NAVY.
WHILE THE PRIME CONTRACTOR WAS NOT ACTING AS PURCHASING AGENT FOR THE
GOVERNMENT AND ITS SUBCONTRACTS ARE THEREFORE GENERALLY NOT SUBJECT TO
THE STATUTORY AND REGULATORY REQUIREMENTS WHICH GOVERN DIRECT
PROCUREMENT BY THE UNITED STATES, IT SHOULD BE NOTED THAT WHERE THE
INITIAL SOLICITATION UTILIZED A "BRAND NAME OR EQUAL" SPECIFICATION
WHICH DID NOT SET OUT THE SALIENT CHARACTERISTICS OF THE ITEM TO BE
PURCHASED, WHEN AN EQUIVALENT WAS FOUND THIS INFORMATION WAS PROPERLY
MADE AVAILABLE TO THE OFFERORS AND EACH WAS GIVEN AN OPPORTUNITY TO
SUBMIT A PRICE OR MODIFY A PRICE ALREADY SUBMITTED. THEREFORE, THERE IS
NO BASIS TO QUESTION THE PROPRIETY OF THE PROCUREMENT.
TO WASHINGTON CHAIN & SUPPLY COMPANY, INC.:
REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 24, 1970, AND SUBSEQUENT
CORRESPONDENCE AND THE LETTER OF MARCH 29, 1971, FROM YOUR COUNSEL,
PROTESTING AGAINST THE AWARD OF A SUBCONTRACT TO ANOTHER CONCERN UNDER A
SOLICITATION ISSUED BY INGALLS WEST DIVISION OF LITTON INDUSTRIES
(INGALLS) WHICH HAS A PRIME CONTRACT (NO. N00024-69-C-0283) WITH THE
DEPARTMENT OF THE NAVY.
THE PRIME CONTRACT IS A MULTI-YEAR FIXED PRICE INCENTIVE (SUCCESSIVE
TARGETS) CONTRACT FOR THE CONSTRUCTION OF NINE GENERAL PURPOSE
AMPHIBIOUS ASSAULT VESSELS (LHA). IN THE PERFORMANCE THEREOF, INGALLS,
ON JUNE 24, 1970, ISSUED A SOLICITATION TO 18 POTENTIAL SUPPLIERS FOR
THREE SHIPSETS OF AN ANCHOR HANDLING SYSTEM WITH AN OPTION TO PURCHASE
SIX MORE SHIPSETS. THE SOLICITATION CALLED FOR SEVEN OF THE NINE
COMPONENTS OF THE ANCHOR HANDLING SYSTEM TO BE "DIE LOCK CHAIN OR
EQUAL."
TWO OFFERS WERE RECEIVED. BALDT ANCHOR AND CHAIN (BALDT) OFFERED THE
DESIGNATED "DIE LOCK" CHAIN WHILE WASHINGTON CHAIN OFFERED AS AN EQUAL
"STUD-LINK WELDED CHAIN." FOR THE NINE FULL SHIPSETS, WASHINGTON CHAIN'S
PRICE WAS SOME $650,000 LOWER THAN BALDT'S; FOR THE THREE REQUIRED
SHIPSETS WASHINGTON CHAIN'S PRICE WAS SOME $195,000 LOWER THAN BALDT'S.
INGALLS HAS ADVISED THE NAVAL SHIP SYSTEMS COMMAND THAT AN
ENGINEERING EVALUATION WAS NECESSARY TO DETERMINE WHETHER "STUD-LINK"
WAS EQUAL TO "DIE-LOCK." THIS EVALUATION, COMPLETED ON OCTOBER 15, 1970,
FOUND THAT THE TWO CHAINS WERE EQUAL. HOWEVER, INGALLS DETERMINED THAT
THE TWO OFFERS WERE NOT COMPARABLE SINCE THE "STUD-LINK" WELDED TYPE OF
CHAIN IS LESS COSTLY THAN "DIE-LOCK" CHAIN. THEREFORE, INGALLS DECIDED
TO RESOLICIT OFFERS FROM BOTH FIRMS ON THE "STUD-LINK" TYPE OF CHAIN.
ON OCTOBER 19, 1970, BALDT SUBMITTED AN OFFER ON "STUD-LINK" CHAIN IN
RESPONSE TO A SOLICITATION OF OCTOBER 16. ON OCTOBER 28, 1970, INGALLS
SENT A TELEGRAM TO YOUR CONCERN ADVISING THAT BALDT HAD BEEN SOLICITED
FOR THE "STUD-LINK" CHAIN AND GIVING WASHINGTON THE OPPORTUNITY TO
REVISE ITS PRICE ON "STUD-LINK." WASHINGTON SUBMITTED A REVISED
QUOTATION ON NOVEMBER 5, 1970.
AS A RESULT OF THE RESOLICITATION, BALDT'S PRICE FOR THE NINE ITEMS
AND THE THREE ITEMS OF SHIPSETS WAS SOME $39,000 AND $14,000 LOWER,
RESPECTIVELY, THAN YOUR PRICES FOR THESE ITEMS. AWARD WAS MADE TO BALDT
AS THE LOW OFFEROR. THE CLAUSE RELATING TO "SUBCONTRACTS" SET FORTH IN
ARMED SERVICES PROCUREMENT REGULATION (ASPR) 23-201.1 WAS INCLUDED IN
INGALLS' CONTRACT AND PURSUANT TO THE CLAUSE THE CONTRACTING OFFICER
CONSENTED TO THE AWARD TO BALDT ON DECEMBER 21, 1970.
IT IS URGED IN YOUR PROTEST THAT BALDT INITIALLY COULD HAVE SUBMITTED
ALTERNATIVE OFFERS ON BOTH "DIE-LOCK" AND "STUD-LINK" TYPE OF CHAIN AND
THAT THERE IS NO BASIS FOR INGALLS' CONCLUSION THAT THE OFFERS FROM
BALDT AND YOUR CONCERN WERE NOT COMPARABLE. YOUR PROTEST IS AGAINST THE
RESOLICITATION OF OFFERS AND IT IS YOUR CONTENTION THAT AWARD SHOULD
HAVE BEEN MADE TO YOUR CONCERN UNDER THE INITIAL SOLICITATION.
THERE IS NOTHING IN THE RECORD TO INDICATE THAT INGALLS WAS ACTING AS
A PURCHASING AGENT FOR THE GOVERNMENT RATHER THAN IN AN INDEPENDENT
CAPACITY. WHERE THE PRIME CONTRACTOR HAS INDEPENDENT STATUS, WE HAVE
RECOGNIZED THAT THE PRACTICES AND PROCEDURES EMPLOYED IN THE AWARD OF
SUBCONTRACTS BY PRIME CONTRACTORS OF THE UNITED STATES ARE GENERALLY NOT
SUBJECT TO THE STATUTORY AND REGULATORY REQUIREMENTS WHICH WOULD GOVERN
DIRECT PROCUREMENT BY THE UNITED STATES. 49 COMP. GEN. 668 (1970), AND
CASES CITED THEREIN. NEVERTHELESS, APPROVAL OF THE SUBCONTRACT AWARD
REQUIRED BY THE TERMS OF THE PRIME CONTRACT SHOULD NOT BE GRANTED BY THE
GOVERNMENT CONTRACTING OFFICER WHERE SUCH AWARD WOULD BE CONTRARY TO THE
INTERESTS OF THE GOVERNMENT. 37 COMP. GEN. 315 (1957).
WE ARE ADVISED THAT INGALLS' INITIAL SOLICITATION WHICH UTILIZED A
"BRAND NAME OR EQUAL" TYPE OF SPECIFICATION DID NOT SET OUT THE SALIENT
CHARACTERISTICS OF, OR OTHERWISE DEFINITELY DESCRIBE, THE ITEM TO BE
PURCHASED. OFFERORS THEREFORE COULD NOT BE SURE WHAT WOULD BE REGARDED
AS THE EQUAL TO "DIE-LOCK." AFTER IT WAS ASCERTAINED THAT FOR PURPOSES
OF THE PROCUREMENT "STUD-LINK" WAS THE EQUIVALENT OF "LIE-LOCK" THIS
INFORMATION WAS PROPERLY MADE AVAILABLE TO THE OFFERORS AND EACH WAS
GIVEN AN OPPORTUNITY TO SUBMIT A PRICE ON OR MODIFY A PRICE ALREADY
SUBMITTED ON "STUD-LINK." IT IS PERHAPS UNFORTUNATE THAT INTERESTED
PARTIES WERE NOT ADVISED INITIALLY THAT "STUD-LINK" WOULD SATISFY THE
PURPOSES OF THE PROCUREMENT. HOWEVER, NOT TO HAVE REMEDIED THE DEFECT
WHEN IT WAS RECOGNIZED WHERE THE COST OF THE SUBCONTRACT MAY AFFECT THE
ULTIMATE COST TO THE GOVERNMENT, IN OUR VIEW, WOULD HAVE BEEN IMPROPER.
IN SUM, BOTH OFFERORS WERE GIVEN THE OPPORTUNITY TO SUBMIT REVISED
PRICES ON THE "STUD-LINK" WELDED CHAIN; BALDT SUBMITTED THE LOW OFFER
TO THE RESOLICITATION AND THAT AWARD WAS MADE ON THE LOW OFFER.
PURSUANT TO OUR REVIEW, WE FIND NO BASIS TO QUESTION THE PROPRIETY OF
THE PROCUREMENT OR THE CONTRACTING OFFICER'S CONSENT THERETO.
B-172067, MAY 19, 1971
CONTRACTS - AMBIQUOUS LANGUAGE - PROGRESS PAYMENTS
DECISION AUTHORIZING PAYMENT OF A VOUCHER FOR $600,000 IN FAVOR OF
VINNELL-DRAVO-LOCKHEED-MANNIX, A JOINT VENTURE, REPRESENTING A PORTION
OF THE AMOUNT PREVIOUSLY WITHHELD FROM PROGRESS PAYMENTS INCIDENT TO
CONSTRUCTION WORK AT THE THIRD POWERPLANT, GRAND COULEE DAM, COLUMBIA
BASIN PROJECT, WASHINGTON.
A CONTRACT PROVISION THAT STATES, "ON COMPLETION AND ACCEPTANCE OF
EACH SEPARATE BUILDING, PUBLIC WORK OR OTHER DIVISION OF THE CONTRACT,
ON WHICH THE PRICE IS STATED SEPARATELY IN THE CONTRACT, PAYMENT MAY BE
MADE THEREFOR WITHOUT RETENTION OF A PERCENTAGE", IS AMBIGUOUS, THE
CONTRACTOR CLAIMING THAT NO PERCENTAGE SHOULD BE RETAINED ON PAYMENTS
FOR MOBILIZATION AND PREPARATORY WORK WHICH HAS A LUMP SUM CONTRACT
PRICE OF $6 MILLION.
BECAUSE THERE EXISTS MORE THAN ONE REASONABLE INTERPRETATION OF THE
CONTRACT LANGUAGE, IT SHOULD BE CONSTRUED AGAINST THE DRAFTER - THE
GOVERNMENT - AND PAYMENT MAY BE MADE TO THE CONTRACTOR UPON RECEIPT OF
THE SURETY'S CONSENT.
TO MRS. BLACKWELL:
REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 17, 1970, WITH
ENCLOSURES, REQUESTING ADVICE AS TO THE LEGALITY OF CERTIFYING FOR
PAYMENT A VOUCHER IN THE AMOUNT OF $600,000, STATED IN FAVOR OF
VINNELL-DRAVO-LOCKHEED-MANNIX, A JOINT VENTURE, AND REPRESENTING A
PORTION OF THE AMOUNT PREVIOUSLY WITHHELD IN MAKING PROGRESS PAYMENTS
UNDER DEPARTMENT OF THE INTERIOR CONTRACT NO. 14-06-D-6965, DATED
FEBRUARY 26, 1970, ENTERED INTO WITH THE JOINT VENTURE FOR THE
PERFORMANCE OF CONSTRUCTION WORK AT THE THIRD POWERPLANT, GRAND COULEE
DAM, COLUMBIA BASIN PROJECT, WASHINGTON.
THE VOUCHER INDICATES THAT, IN MAKING 10 PREVIOUS PROGRESS PAYMENTS
UNDER THE CONTRACT, THE GOVERNMENT WITHHELD $2,452,814.76, OR 10 PERCENT
OF ESTIMATED NET EARNINGS, AND THAT THE RETAINED PERCENTAGE INCLUDES 10
PERCENT OF THE LUMP-SUM CONTRACT PRICE OF $6 MILLION FOR MOBILIZATION
AND PREPARATORY WORK, AS SET FORTH IN CONTRACT SCHEDULE ITEM NO. 1.
IT IS REPORTED THAT, BY LETTER DATED OCTOBER 20, 1970, THE CONTRACTOR
REQUESTED PAYMENT OF THE RETAINAGE ON THIS ITEM, CONTENDING THAT, SINCE
THE PRICE WAS STATED SEPARATELY, PAYMENT IN FULL COULD BE MADE IN
ACCORDANCE WITH SUBPARAGRAPH (C) OF PARAGRAPH 7 OF THE GENERAL
PROVISIONS OF THE CONTRACT (STANDARD FORM 23A), ENTITLED "PAYMENTS TO
CONTRACTOR." SUBPARAGRAPH 7(C) PROVIDES IN PART THAT, IN MAKING PROGRESS
PAYMENTS, THERE SHALL BE RETAINED 10 PERCENT OF THE ESTIMATED AMOUNT
UNTIL FINAL COMPLETION AND ACCEPTANCE OF THE CONTRACT WORK, BUT THE LAST
SENTENCE OF THE SUBPARAGRAPH STATES THAT, ON COMPLETION AND ACCEPTANCE
OF EACH SEPARATE BUILDING, PUBLIC WORK, OR OTHER DIVISION OF THE
CONTRACT, ON WHICH THE PRICE IS STATED SEPARATELY IN THE CONTRACT,
PAYMENT MAY BE MADE THEREFOR WITHOUT RETENTION OF A PERCENTAGE.
THE DIRECTOR OF DESIGN AND CONSTRUCTION, BUREAU OF RECLAMATION,
ENGINEERING AND RESEARCH CENTER, DENVER FEDERAL CENTER, DENVER,
COLORADO, INITIALLY DETERMINED THAT THE CONTRACTOR'S REQUEST SHOULD NOT
BE APPROVED. HOWEVER, UPON RECEIPT OF ADDITIONAL INFORMATION FROM THE
CONTRACTOR, INCLUDING REFERENCE TO TWO PROJECTS OF THE CORPS OF
ENGINEERS, ON WHICH THE VINNELL CORPORATION WAS A MEMBER OF THE JOINT
VENTURE FOR SIMILAR ITEMS OF WORK, THE DIRECTOR OF DESIGN AND
CONSTRUCTION APPROVED THE CONTRACTOR'S REQUEST IN A LETTER DATED
DECEMBER 4, 1970, WHICH IS, IN PERTINENT PART, AS FOLLOWS:
"IT IS AT LEAST QUESTIONABLE WHETHER OR NOT THE LAST SENTENCE OF
CLAUSE NO. 7(C) COVERS AN ITEM SUCH AS MOBILIZATION AND PREPARATORY
WORK. *** THIS SENTENCE WOULD APPEAR TO BE SPEAKING OF TANGIBLE AND
SEPARABLE ITEMS OF THE CONTRACT WORK, SUCH AS A BUILDING OR OTHER
PHYSICAL FEATURE, AND NOT TO AN ITEM SUCH AS MOBILIZATION, SINCE THE
EFFECTIVE VALUE OF SUCH AN ITEM IS SPREAD OVER THE ENTIRE LENGTH OF THE
JOB.
"CLAUSE NO. 7(C) STATES THAT SUCH PAYMENT WILL BE MADE UPON
'COMPLETION AND ACCEPTANCE' OF THE ITEM OF WORK. THERE IS NO
'ACCEPTANCE' BY THE GOVERNMENT, EITHER FORMALLY OR INFORMALLY, OF THE
ITEM FOR MOBILIZATION AND PREPARATORY WORK AND THIS FACT COULD LEAD ONE
TO CONCLUDE THAT THE PROVISIONS OF THE LAST SENTENCE OF CLAUSE NO. (7C)
DO NOT APPLY TO THE ITEM FOR MOBILIZATION. IN THIS CONNECTION, THE LAST
SENTENCE IN THE NEXT TO THE LAST PARAGRAPH OF PARAGRAPH 11 OF THE
SPECIFICATIONS STATES THAT PAYMENTS MADE FOR PREPARATORY WORK *** 'SHALL
NOT OPERATE TO VEST TITLE IN THE GOVERNMENT *** .' THIS PROVISION WOULD
INDICATE THAT NO ACCEPTANCE BY THE GOVERNMENT WAS CONTEMPLATED.
"LASTLY, IT IS NOTED THAT PARAGRAPH 11 SPECIFICALLY PROVIDES THAT
PAYMENTS UNDER THIS ITEM ARE SUBJECT TO THE RETENTION REQUIRED BY CLAUSE
NO. 7.
"IN RESPONSE TO THIS ANALYSIS, THE CONTRACTOR CONTENDS SIMPLY THAT
THE ITEM IN QUESTION IS COMPLETE AND THAT IT IS A ' *** DIVISION OF THE
CONTRACT ON WHICH THE PRICE IS SEPARATELY STATED IN THE CONTRACT *** '
WITHIN THE MEANING OF THE LAST SENTENCE OF CLAUSE NO. 7(C). IN
ADDITION, THE PAYMENT PROCEDURE CONTENDED FOR WAS APPARENTLY FOLLOWED ON
TWO OTHER FEDERAL PROJECTS CONSTRUCTED BY THE CORPS OF ENGINEERS ON
WHICH THE CONTRACTOR WAS VINNELL. I MUST CONCEDE THAT THE ISOLATED
PLAIN MEANING OF THE LAST SENTENCE OF CLAUSE NO. 7(C) SEEMS TO INDICATE
THAT PAYMENT OF THE RETAINED PERCENTAGE IS PROPER IN THIS INSTANCE.
"ON EVIDENCE SUPPLIED BY THE CONTRACTOR, I HAVE VERIFIED THAT THE
CORPS OF ENGINEERS DID, IN FACT, CONSTRUE THE LAST SENTENCE OF CLAUSE
NO. 7(C) IN THE FASHION ASSERTED BY THE CONTRACTOR. WE HAVE ALSO
INVESTIGATED THE SPECIAL PROVISIONS COMPARABLE TO PARAGRAPH 11 IN THESE
CORPS SPECIFICATIONS AND HAVE ASCERTAINED THAT THEY DO CONTAIN SIMILAR
PROVISIONS FOR THE HANDLING OF RETENTION AND DO HAVE REFERENCES SIMILAR
TO THOSE FOUND IN PARAGRAPH 11 TO THE EFFECT THAT RETENTION UNDER CLAUSE
NO. 7 WILL BE MADE.
"BASED UPON THE FOREGOING ANALYSIS, IT IS MY OPINION THAT THE MOST
REASONABLE CONSTRUCTION OF THE INVOLVED PROVISIONS DOES NOT SUPPORT THE
RELEASE OF THE RETENTION. HOWEVER, I MUST ALSO CONCEDE THAT THE
APPLICABLE LANGUAGE, IN TOTAL, IS AMBIGUOUS AS TO THE PRECISE POINT AT
ISSUE. IT IS A WELL ACCEPTED PRINCIPLE OF INTERPRETATION THAT CONTRACT
LANGUAGE WILL BE CONSTRUED AGAINST THE DRAFTER (HERE THE GOVERNMENT)
WHERE MORE THAN ONE REASONABLE INTERPRETATION OF THE SAME IS POSSIBLE.
IN OTHER WORDS, THE MOST REASONABLE INTERPRETATION WILL NOT NECESSARILY
BE ADOPTED WHERE ANOTHER REASONABLE INTERPRETATION IS ALSO JUSTIFIED AND
THE CONTRACTOR HAS RELIED ON THE LATTER INTERPRETATION IN BIDDING. IN
VIEW OF THE CONTRACTOR'S PREVIOUS EXPERIENCE WITH THE CORPS OF
ENGINEERS, I AM SATISFIED THAT THE CONTRACTOR HERE RELIED ON THIS
ASSERTED INTERPRETATION IN BIDDING."
WE AGREE THAT THE LANGUAGE OF SUBPARAGRAPH 7(C) OF THE GENERAL
PROVISIONS OF THE CONTRACT IS AMBIGUOUS AS TO THE PRECISE POINT AT
ISSUE, AND THAT THERE EXISTS A REASONABLE BASIS FOR CONSIDERING THAT THE
RETAINED PERCENTAGE ON CONTRACT SCHEDULE ITEM NO. 1, WHICH HAS BEEN
COMPLETED AND MIGHT BE CONSIDERED TO BE A DIVISION OF THE CONTRACT,
SHOULD BE PAID TO THE CONTRACTOR. IN THE CIRCUMSTANCES, WE BELIEVE THAT
THE ATTITUDE OF THE SURETY ON THE PERFORMANCE AND PAYMENT BONDS SHOULD
BE CONSIDERED BEFORE RELEASING THE CLAIMED AMOUNT. SEE 46 COMP. GEN.
730, 733 (1967).
IN THE CIRCUMSTANCES, YOU ARE ADVISED THAT THE VOUCHER FOR $600,000,
WHICH IS RETURNED HEREWITH, PROPERLY MAY BE CERTIFIED FOR PAYMENT UPON
RECEIPT OF THE SURETY'S CONSENT TO THE RELEASE OF THAT AMOUNT TO THE
CONTRACTOR.
B-166868, MAY 18, 1971
BID PROTEST - RESTRICTIVE SPECIFICATIONS
DECISION DENYING PROTEST AGAINST THE REQUIREMENT THAT CHEMICAL
LABORATORY SINKS AND CABINET TOPS BE CONSTRUCTED WITH PYROCERAM,
MANUFACTURED BY CORNING GLASS WORKS FOR THE NEW UNITED STATES GEOLOGICAL
SURVEY HEADQUARTERS BUILDING, RESTON, VIRGINIA.
BECAUSE THE DRAFTING OF SPECIFICATIONS TO REFLECT THE NEEDS OF THE
GOVERNMENT AND THE DETERMINATION AS TO WHETHER THOSE NEEDS CAN BE MET BY
A GIVEN PRODUCT ARE PRIMARILY WITHIN THE JURISDICTION OF THE PROCURING
AGENCY, THE COMP. GEN. FINDS NO BASIS FOR A LEGAL OBJECTION TO THE
DESIGNATION OF PYROCERAM IN LIGHT OF THE GEOLOGICAL SURVEY'S TESTING AND
SPECIFIC REQUEST THEREFOR.
CONCERNING PROTESTANT'S STATEMENT THAT CRONING HAS REDESIGNED THE
PYROCERAM MATERIAL, GSA WILL BE NOTIFIED.
TO GEORGIA MARBLE COMPANY:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 10, 1971, AND PRIOR
CORRESPONDENCE, PROTESTING THE USE OF ALLEGEDLY RESTRICTIVE
SPECIFICATIONS IN THE PROCUREMENT OF CHEMICAL LABORATORY SINKS AND
CABINET TOPS FOR THE NEW UNITED STATES GEOLOGICAL SURVEY HEADQUARTERS
BUILDING, RESTON, VIRGINIA.
GULF-RESTON, INC., ADVERTISED FOR PROPOSALS FOR THE CONSTRUCTION OF
THE NEW HEADQUARTERS BUILDING FOR THE GEOLOGICAL SURVEY, DEPARTMENT OF
THE INTERIOR, IN RESTON, VIRGINIA. UNDER AN AGREEMENT WITH THE GENERAL
SERVICES ADMINISTRATION (GSA), IF THE BUILDING BE BUILT BY GULF-RESTON,
INC., IT WOULD BE LEASED FOR 20 YEARS TO THE UNITED STATES, AT THE END
OF WHICH TIME TITLE TO THE BUILDING WOULD VEST IN THE UNITED STATES.
BOTH GSA AND THE GEOLOGICAL SURVEY HAVE BEEN CLOSELY INVOLVED IN ALL OF
THE HEADQUARTERS BUILDING PLANS AND SPECIFICATIONS WHICH SPECIFY
PYROCERAM, A THREE-STAGE CHEMICAL-TREATED TEMPERED GLASS MANUFACTURED BY
THE CORNING GLASS WORKS, AS THE MATERIAL TO BE USED FOR LABORATORY SINKS
AND FUME HOOD WORK TOPS. WHILE PYROCERAM WAS SPECIFIED, THE INVITATION
DID PERMIT BIDDERS UNDER THE GENERAL CONDITIONS, SECTION 1, ARTICLE
1-14-BIDDING PROCEDURES; SUBSTITUTIONS OF MATERIALS, EQUIPMENT OR
PROCESSES, TO OFFER WITH THEIR BIDS A SUBSTITUTE PRODUCT EQUAL IN
QUALITY AND SERVICEABILITY TO THE SPECIFIED PRODUCT.
YOU STATE THAT THE SPECIFICATIONS AS PRESENTLY WRITTEN FOR COUNTERTOP
MATERIAL ON THIS PROJECT INCLUDE ONLY THE SERVICE LEDGES AND FRAMING TO
SUPPORT THESE LEDGES; THAT NO OTHER COUNTERTOP MATERIAL AND/OR BASE
CABINETS ARE INCLUDED IN THE GENERAL CONTRACT BID; AND THAT IT IS YOUR
UNDERSTANDING THAT THE COUNTERTOPS THEMSELVES WILL BE BID AT A FUTURE
DATE BY THE OWNER OF THE BUILDING TO AVOID A LARGER SUM OF MONEY BEING
SPENT IN THE CONSTRUCTION OF THE BUILDING VERSUS BUYING THIS MATERIAL AS
"EQUIPMENT" AT A LATER DATE. YOU ALSO STATE THAT YOU ARE CONFIDENT THAT
ANY SPECIFICATIONS WRITTEN AT A FUTURE DATE FOR COUNTERTOP MATERIAL WILL
STATE "ALL COUNTERTOPS MUST MATCH IN ALL DETAILS WITH THE SERVICE LEDGES
PREVIOUSLY PROVIDED FOR THIS PROJECT" AND THAT "THEY SHALL BE
MANUFACTURED FROM THE SAME MATERIAL AND SUPPLIED FROM THE SAME SOURCE AS
THE ORIGINAL SERVICE LEDGES." THEREFORE, YOU STATE THAT IT IS NECESSARY
TO OBTAIN EQUAL SPECIFICATION ACCEPTANCE AT THIS TIME PRIOR TO THE
AWARDING OF THE GENERAL CONTRACT.
YOU STATE THAT YOU ARE NOT REQUESTING TO BE ALLOWED TO OFFER AN
ALTERNATE PRODUCT UNDER THE STIPULATIONS AND CONDITIONS OF THE GENERAL
SPECIFICATIONS BUT THAT YOU ARE ASKING FOR AN AND/OR EQUAL CLAUSE TO BE
ADDED BY ADDENDUM TO THE SPECIFICATIONS AT THIS TIME ALLOWING ALBERENE
STONE AS AN ACCEPTABLE COUNTERTOP MATERIAL OF CHOICE.
IN ITS REPORT OF JANUARY 14, 1971, A COPY OF WHICH WAS FURNISHED TO
YOUR FIRM, GSA STATED THAT PYROCERAM WAS SPECIFIED IN THE SPECIFICATIONS
AT THE SPECIFIC REQUEST OF THE U.S. GEOLOGICAL SURVEY; THAT THE SURVEY
REQUESTED THE SPECIFIC USE OF THIS MATERIAL AFTER EXTENSIVE TESTS WERE
CONDUCTED BY ITS HEAD CHEMIST; AND THAT ITS TESTS HAVE INDICATED TO
THEM THAT THE THREE-STAGE CHEMICAL-TREATED TEMPERED GLASS (PYROCERAM)
WILL PROVIDE THEM WITH THE NECESSARY CHEMICAL RESISTANCE, ABRASIVE
RESISTANCE, HEAT RESISTANCE, IMPACT RESISTANCE, WATER ABSORPTION,
POROSITY, AND APPEARANCE THAT IS REQUIRED IN THEIR LABORATORY OPERATION.
YOU STATE THAT IN A LETTER DATED OCTOBER 30, 1970, CORNING GLASS
WORKS ADVISED ALL FURNITURE MANUFACTURERS THAT PYROCERAM MATERIAL HAD
BEEN REDESIGNED; THAT NEW SPECIFICATIONS FOR THE NEW MATERIAL WOULD BE
MADE AVAILABLE IN THE NEAR FUTURE; AND THAT THE NEWLY DESIGNED MATERIAL
WILL BE THE ONLY PRODUCT SHIPPED AFTER JUNE 1, 1971. YOU CONTEND THAT
THE NEWLY DESIGNED PRODUCT WILL NOT SATISFY THE EXISTING SPECIFICATIONS
FOR PYROCERAM AS SPECIFIED FOR THE GEOLOGICAL SURVEY BUILDING. YOU
STATE THAT YOU WONDER WHETHER AN ADDITIONAL CHANGE IN THE SPECIFICATIONS
WILL BE MADE AT A CONVENIENT TIME TO MEET CORNING'S NEW SPECIFICATIONS
RATHER THAN CONSIDERATION BEING GIVEN TO ADDITIONAL PRODUCTS.
YOU REFER TO THE FOLLOWING STATEMENT MADE BY THE GEOLOGICAL SURVEY IN
ITS LETTER OF OCTOBER 23, 1970, TO GSA:
" *** MUCH OF OUR WORK REQUIRES DETERMINATION OF ELEMENTS IN GEOLOGIC
MATERIALS AT EXCEEDINGLY LOW CONCENTRATIONS-WE REGULARLY DETERMINE
ELEMENTS TO CONCENTRATIONS OF 0.0001 PERCENT AND FREQUENTLY TO 0.0000001
PERCENT. WE HAVE, THEREFORE, STRESSED THROUGHOUT OUR LABORATORY DESIGN,
FROM THE FLOOR TO THE CEILING, THE USE OF MATERIALS APPROPRIATE TO THESE
SPECIAL NEEDS."
WHILE YOU ADMIT THAT ALBERENE STONE WILL NOT MEET THE FOREGOING
REQUIREMENTS FOR DETERMINATIONS IN CONCENTRATIONS AS LOW AS MENTIONED
ABOVE, YOU, HOWEVER, QUESTION IF EACH AND EVERY LABORATORY WITHIN THE
ENTIRE BUILDING MUST BE DESIGNED TO MEET THESE SPECIFIC REQUIREMENTS FOR
SUCH EXCEEDINGLY LOW CONCENTRATION DETERMINATIONS.
IN ITS LETTER OF OCTOBER 23, 1970, THE GEOLOGICAL SURVEY STATED THAT
A LABORATORY FACILITIES EQUIPMENT COMMITTEE WAS ESTABLISHED FOR THE
PURPOSE OF CONDUCTING A STUDY OF THE VARIOUS MATERIALS AVAILABLE FOR USE
AS CHEMICAL RESISTANT WORKING SURFACES ON THE TOP OF SINKS, FUME HOODS,
AND ASSOCIATED CABINETS; THAT MATERIALS INVESTIGATED INCLUDE
ALBERENE-25 SOAP-STONE, VARIOUS SYNTHETIC STONES, STAINLESS STEEL, AND
THE GLASS-CERAMIC KNOWN AS PYROCERAM; AND THAT THE COMMITTEE AGREED
THAT PYROCERAM WAS SUITED FOR ITS NEEDS BECAUSE OF ITS SUPERIOR
RESISTANCE TO CHEMICAL ATTACK AND ABRASION AND BECAUSE IT HAS ZERO
POROSITY AND IS IMPERVIOUS TO WATER. THE COMMITTEE CONCLUDED THAT ANY
MATERIAL WHICH DOES NOT MEASURE UP TO THE FOREGOING STANDARDS WOULD NOT
BE ACCEPTABLE FOR THE GEOLOGICAL SURVEY LABORATORIES.
IT IS WELL SETTLED THAT THE DRAFTING OF SPECIFICATIONS TO REFLECT THE
NEEDS OF THE GOVERNMENT AND THE DETERMINATION AS TO WHETHER THOSE NEEDS
CAN BE MET BY A GIVEN PRODUCT ARE PRIMARILY WITHIN THE JURISDICTION OF
THE PROCURING AGENCY. 17 COMP. GEN. 554 (1938); 39 ID. 570 (1960).
WHILE THE LAW REQUIRING ADVERTISING FOR BIDS AND AWARD OF CONTRACTS TO
THE LOWEST RESPONSIBLE, RESPONSIVE BIDDER, IN EACH CASE, CONTEMPLATES
FREE AND UNRESTRICTIVE COMPETITION, THE FACT THAT A PARTICULAR BIDDER
MIGHT BE UNABLE OR UNWILLING TO MEET THE MINIMUM REQUIREMENTS FOR THE
SUPPLYING OF THE NEEDS WILL NOT BE SUFFICIENT TO RENDER THE CONCLUSION
THAT THE SPECIFICATIONS ARE UNDULY RESTRICTIVE. 30 COMP. GEN. 368
(1951). FURTHER, THERE IS NO REQUIREMENT THAT THE UNITED STATES PURCHASE
ITEMS MERELY BECAUSE THEY ARE OFFERED AT A LOWER PRICE, WITHOUT
INTELLIGENT REFERENCE TO THE PARTICULAR NEEDS TO BE SERVED, NOR IS THE
GOVERNMENT TO BE PLACED IN THE POSITION OF ALLOWING BIDDERS TO DICTATE
SPECIFICATIONS WHICH WILL PERMIT ACCEPTANCE OF PRODUCTS WHICH DO NOT, IN
THE CONSIDERED JUDGMENT OF THE CONTRACTING AGENCY, REASONABLY MEET THE
USING AGENCY'S NEEDS. 36 COMP. GEN. 251, 252 (1956); B-152861, APRIL
10, 1964.
IN THE CIRCUMSTANCES, THERE IS NO BASIS FOR A LEGAL OBJECTION BY OUR
OFFICE TO THE DESIGNATION OF PYROCERAM IN THE ADVERTISEMENT FOR
PROPOSALS. HOWEVER, IN VIEW OF THE STATEMENTS IN YOUR LETTER OF MARCH
10, 1971, TO THE EFFECT THAT CORNING GLASS WORKS HAS ADVISED ALL
FURNITURE MANUFACTURERS THAT PYROCERAM MATERIAL HAD BEEN REDESIGNED AND
THAT IT IS YOUR OPINION THAT THE NEWLY DESIGNED PRODUCT WILL NOT SATISFY
THE EXISTING SPECIFICATIONS FOR PYROCERAM AS SPECIFIED FOR THE
GEOLOGICAL SURVEY BUILDING, WE ARE FORWARDING COPIES OF YOUR LETTER OF
MARCH 10, 1971, AND ENCLOSURES, TO GSA FOR ITS INFORMATION SO THAT IT
MAY TAKE SUCH ACTION AS IT DEEMS NECESSARY.
B-170528, MAY 18, 1971
BID PROTEST - UNREALISTIC SPECIFICATION - TECHNICAL CONSIDERATION
DECISION DENYING PROTEST AGAINST AWARD OF CONTRACT TO NUCLEAR
SYSTEMS, INC., UNDER AN RFP ISSUED BY THE ARMY ELECTRONICS COMMAND TO
ESTABLISH PRODUCTION CAPABILITY TECHNIQUES FOR THE FABRICATION OF
CERTAIN THERMOELECTRIC COOLERS.
A PROTEST BASED NOT ON A MATTER OF LAW, BUT INVOLVING SPECIAL
SCIENTIFIC EXPERTISE IS NOT WITHIN THE JURISDICTION OF GAO. WHERE
EXTENSIVE NEGOTIATIONS WERE HELD WITH BOTH OFFEROR AND SUCCESSFUL OFFER
ACCEPTED THE REQUIREMENT THAT THE SUBJECT COOLERS OPERATE WITH A
COEFFICIENT OF PERFORMANCE 0.2 AS A FIRM COMMITTMENT WHILE PROTESTANT
DID NOT AGREE THAT SUCH EFFICIENCY WAS PRESENTLY POSSIBLE, IT MUST BE
LEFT TO THE CONTRACTOR'S PERFORMANCE TO SETTLE THE DIFFERENCE OF
OPINION.
TO BORG-WARNER THERMOELECTRICS:
REFERENCE IS MADE TO YOUR LETTER OF JANUARY 7, 1971, AND PRIOR
CORRESPONDENCE, PROTESTING THE AWARD OF A CONTRACT TO ANOTHER FIRM UNDER
REQUEST FOR PROPOSALS (RFP) NO. DAAB05-70-R-0474 ISSUED BY THE UNITED
STATES ARMY ELECTRONICS COMMAND (ARMY), PHILADELPHIA, PENNSYLVANIA.
THE RFP, ISSUED APRIL 22, 1970, COVERED A PRODUCTION ENGINEERING
MEASURE (PEM) TO ESTABLISH PRODUCTION CAPABILITY TECHNIQUES FOR THE
FABRICATION OF 2-WATT, 20-WATT AND 100-WATT THERMOELECTRIC COOLERS.
ARMY REGULATION 37-40, PARAGRAPHS 39 THROUGH 41, PROVIDES THAT IT IS THE
GENERAL PURPOSE OF PEM PROJECTS TO EXPLORE, ANALYZE AND IDENTIFY MAJOR
OBSTACLES TO PRODUCTION OF ESSENTIAL ITEMS FOR WHICH MAJOR DIFFICULTIES
ARE FORESEEN IN MEETING REQUIRED PRODUCTION; TO RECOMMEND SPECIFIC
ACTIONS TO REDUCE SUCH OBSTACLES; TO PROVIDE FOR CONSTRUCTION AND TESTS
OF PILOT MODELS OF PRODUCTION EQUIPMENT; AND TO PROVIDE PRODUCTION
ENGINEERING IN ORDER TO FACILITATE MASS PRODUCTION OF SUCH ITEMS.
THE PROCUREMENT, NEGOTIATED PURSUANT TO 10 U.S.C. 2304(A)(10), THE
EXCEPTION FOR THE PURCHASE OF PROPERTY OR SERVICES FOR WHICH IT IS
IMPRACTICABLE TO OBTAIN COMPETITION, REQUESTED PROPOSALS TO COVER ALL
WORK NECESSARY TO ESTABLISH CAPABILITY TO MANUFACTURE THE
ABOVE-MENTIONED THERMOELECTRIC COOLERS ON A PILOT LINE BASIS,
ENGINEERING AND FIRST ARTICLE SAMPLES, A LIMITED PRODUCTION ITEM,
MONTHLY, QUARTERLY AND FINAL REPORTS, AND A BILL OF MATERIALS FOR THE
THERMOELECTRIC COOLERS REQUIRED.
TWO PROPOSALS, YOURS AND THAT OF NUCLEAR SYSTEMS, INC. (NSI), WERE
RECEIVED AND OPENED ON MAY 22.
ACCOMPANYING YOUR PROPOSAL WAS A LETTER WHICH, IN PERTINENT PART,
STATED:
"IT IS RESPECTFULLY SUGGESTED THAT THE SUBJECT PEM CONTRACT BE
MODIFIED TO INCLUDE FUNDING FOR DEVELOPING PRODUCTION TECHNIQUES AND
EQUIPMENT FOR ADVANCED NEW THERMOELECTRIC MATERIALS. AS OUR PROPOSAL
SHOWS, IT IS IMPOSSIBLE TO MEET THE PROPOSED SPECIFICATIONS USING
READILY AVAILABLE THERMOELECTRIC MATERIAL, HOWEVER, THESE SPECIFICATIONS
CAN BE MORE NEARLY SATISFIED USING ADVANCED NEW MATERIALS AVAILABLE NOW
ONLY IN LABORATORY QUANTITIES. *** " THE SPECIFICATION YOU STATED YOU
COULD NOT MEET WAS THE REQUIREMENT THAT THE COOLERS OPERATE WITH A
COEFFICIENT OF PERFORMANCE (C.O.P.) .2, OR HIGHER. YOU STATE THAT THE
C.O.P. IS LIMITED BY THE QUALITY OF THE THERMOELECTRIC MATERIAL THAT IS
USED IN THE COOLING MODULES AND YOU CONTEND THAT NO MATERIAL IS
AVAILABLE ON THE MARKET WHICH WOULD PERMIT THE COOLERS TO OPERATE WITH A
C.O.P. OF .2 OR HIGHER.
THE PROPOSAL SUBMITTED BY NSI WAS THE LOWEST RECEIVED. WITH ITS
PROPOSAL IT SUBMITTED A LETTER WHICH, IN PERTINENT PART, STATED:
"TO BE A TRULY OBJECTIVE AND RESPONSIVE BIDDER, NUCLEAR SYSTEMS FEELS
IT NECESSARY TO POINT OUT THAT THE ATTAINMENT OF A THERMOELECTRIC
COOLING SYSTEM HAVING A COEFFICIENT OF PERFORMANCE OF 0.20 AND OTHERWISE
MEETING THE PFP REQUIREMENTS IS PUSHING THE STATE-OF-THE ART."
ON MAY 25, 1970, THE CONTRACTING OFFICER REQUESTED THE PRODUCTION
ENGINEERING BRANCH TO CONDUCT A TECHNICAL EVALUATION OF THE TWO
PROPOSALS RECEIVED. AN EVALUATION OF THE TWO PROPOSALS WAS ISSUED JUNE
2, 1970, WHICH STATED:
"2. NUCLEAR SYSTEMS, INC. PROPOSAL WAS REVIEWED AND EVALUATED AS
ACCEPTABLE *** . THIS COMPANY PROPOSED AS A DESIGN GOAL, A C.O.P. OF
.2. THEIR PROPOSAL CITES A C.O.P. OF .16 AND SUGGESTS WITH BETTER
PRODUCTION TECHNIQUES AND METHODS THEY COULD OBTAIN A C.O.P. OF .2.
NUCLEAR WAS CONTACTED BY TELEPHONE TO CLARIFY THEIR PROPOSAL. THEY THEN
STATED THAT WITH THESE NEW TECHNIQUES THEY COULD ATTAIN A C.O.P. OF .2
AND WOULD REMOVE THEIR OBJECTION DURING NEGOTIATIONS. THIS WAS
ACCEPTABLE TO NIGHT VISION LAB PERSONNEL AND COULD BE CLARIFIED BY
NEGOTIATION.
"3. BORG-WARNER TOOK EXCEPTION TO THE C.O.P. OF .2, THE SIZE AND
WEIGHT. SINCE THESE EXCEPTIONS ARE NOT CONSIDERED TO BE EITHER VALID OR
ACCEPTABLE BY NIGHT VISION LAB, BORG-WARNER'S TECHNICAL PROPOSAL WAS
EVALUATED AS NON-ACCEPTABLE. *** "
FURTHER NEGOTIATIONS WERE CONDUCTED JUNE 26, 1970, WITH YOUR FIRM BY
THE PROJECT ENGINEER AND THE CONTRACT SPECIALIST. DURING THE COURSE OF
THESE DISCUSSIONS, YOU FURNISHED A TECHNICAL CLARIFICATION CONCERNING
THE C.O.P. OF .2 WHICH APPEARED TO REMOVE THOSE QUALIFICATIONS CONTAINED
IN YOUR ORIGINAL PROPOSAL. SIMILAR DISCUSSIONS WERE HELD WITH NSI IN
WHICH IT INDICATED THAT IT HAD NO QUESTIONS RELATING TO THE RFP. DURING
THESE DISCUSSIONS, BOTH YOUR FIRM AND NSI WERE REQUESTED TO SUBMIT IN
WRITING CONFIRMATION OF THESE NEGOTIATIONS AND BEST AND FINAL OFFERS
WHICH BOTH OFFERORS DID JUNE 29, 1970.
AS A RESULT OF THESE DISCUSSIONS, THE PRODUCTION ENGINEERING BRANCH
DETERMINED THAT THE PROPOSALS OF BOTH COMPANIES WERE ACCEPTABLE BUT
DETERMINED THAT FURTHER NEGOTIATIONS SHOULD BE CONDUCTED WITH THE
OFFERORS IN AN ATTEMPT TO FURTHER CLARIFY THE PROPOSALS. THEREAFTER, ON
JULY 9, 1970, TELEPHONIC NEGOTIATIONS WERE CONDUCTED WITH BOTH OFFERORS.
DURING THE COURSE OF DISCUSSIONS WITH YOUR FIRM, YOU ADVISED THE
CONTRACTING OFFICER THAT YOUR WRITTEN CONFIRMATION DID NOT ACCEPT THE
C.O.P. OF .2 AS A FIRM COMMITMENT; THAT IT WAS MERELY AN OFFER OF BEST
EFFORT; AND THAT YOU WERE OF THE OPINION THAT THE C.O.P. COULD NOT BE
MET.
THE CONTRACTING OFFICER ALSO CONDUCTED TELEPHONIC NEGOTIATIONS WITH
NSI THE SAME DAY. DURING THIS CONVERSATION THE CONTRACTING OFFICER
ADVISED NSI THAT ITS PRESENT PROPOSAL DID NOT ACCEPT A C.O.P. OF .2 AS A
FIRM COMMITMENT AND THAT ITS PROPOSED PERFORMANCE APPEARED TO ONLY OFFER
BEST EFFORTS. NSI ADVISED THE CONTRACTING OFFICER THAT IT UNDERSTOOD
THAT A C.O.P. OF .2 WAS A FIRM COMMITMENT AND NOT AN OBJECTIVE AND THAT
NSI WOULD MEET THE C.O.P. REQUIREMENT. BY LETTER AND TELEGRAM OF THE
SAME DAY TO THE PROCURING ACTIVITY, NSI CONFIRMED IN WRITING THE
STATEMENTS MADE DURING THE TELEPHONE CONVERSATION. ON JULY 24, 1970,
CONTRACT DAAB05-71-C-2601 WAS AWARDED TO NSI.
IN THIS CASE, BOTH YOU AND THE CONTRACTING AGENCY HAVE BEEN PROVIDED
WITH AN OPPORTUNITY TO COMMENT ON THE OTHER PARTY'S POSITION. IN
SUMMARY, YOU, ON THE ONE HAND, HAVE CONTENDED THAT THE STATE OF THE ART
HAS NOT ADVANCED TO THE POINT WHERE A C.O.P. OF .2 IS POSSIBLE WITH
MATERIAL PRESENTLY AVAILABLE, WHILE THE CONTRACTOR, ON THE OTHER HAND,
BELIEVES THAT IT IS POSSIBLE AND IS PREPARED TO PRESS THE STATE OF THE
ART TO THE POINT WHERE IT WILL BE ABLE TO MEET THE REQUIREMENT. AS
EVIDENCED BY THE AWARD OF THE CONTRACT, THE ARMY IS PREPARED TO PROVIDE
THE CONTRACTOR WITH AN OPPORTUNITY TO ACHIEVE THE RESULT. WHETHER THE
CONTRACTOR WILL SUCCEED AND WHETHER THE ARMY WAS CORRECT IN PLACING ITS
CONFIDENCE IN THE CONTRACTOR REMAIN TO BE DEMONSTRATED BY THE
PERFORMANCE ACHIEVED UNDER THE CONTRACT. IN ANY EVENT, THE FOREGOING
INVOLVES NOT A MATTER OF LAW, BUT SPECIAL SCIENTIFIC EXPERTISE WHICH OUR
OFFICE DOES NOT POSSESS. WE CERTAINLY ARE NOT PREPARED TO SAY ON THE
BASIS OF THE RECORD BEFORE US THAT NSI CANNOT PERFORM AS IT HAS
PROMISED.
IN THE CIRCUMSTANCES, WE HAVE NO CHOICE BUT TO DENY THE PROTEST AND
TO LEAVE THE CONTRACTOR'S PERFORMANCE TO SETTLE THE DIFFERENCE OF
OPINION.
B-171118, MAY 18, 1971
MUSTERING OUT PAY
DENYING CLAIM FOR ADDITIONAL MUSTERING-OUT PAY INCIDENT TO DISCHARGE
FROM THE PHILIPPINE SCOUTS BECAUSE IT WAS NOT RECEIVED BY GAO WITHIN THE
10-YEAR LIMITATION PERIOD PRESCRIBED IN 31 U.S.C. 71A.
TO MR. CEFERINO V. VILLADOLID:
REFERENCE IS MADE TO YOUR LETTER POSTMARKED APRIL 20, 1971,
ACKNOWLEDGING RECEIPT OF OUR LETTER, B-171118, DATED FEBRUARY 10, 1971,
RELATIVE TO YOUR CLAIM FOR ADDITIONAL MUSTERING-OUT PAY IN THE AMOUNT OF
$3,600 INCIDENT TO YOUR DISCHARGE FROM THE PHILIPPINE SCOUTS ON JANUARY
8, 1946.
THE MATTER HAS BEEN THE SUBJECT OF NUMEROUS LETTERS FROM OUR OFFICE
WHICH ADVISED YOU THAT YOUR CLAIM WAS BARRED FROM CONSIDERATION BECAUSE
IT WAS NOT RECEIVED IN THIS OFFICE WITHIN THE 10-YEAR LIMITATION PERIOD
PRESCRIBED IN THE ACT OF OCTOBER 9, 1940, 54 STAT. 1061, 31 U.S.C. 71A.
THEY STATED FURTHER THAT SINCE YOU SAID YOU RECEIVED $300 MUSTERING-OUT
PAY UPON DISCHARGE, YOU HAD BEEN PAID THE MAXIMUM AUTHORIZED BY LAW AND
WE HAD FOUND NO STATUTORY AUTHORITY FOR THE PAYMENT OF THE ADDITIONAL
AMOUNT YOU WERE CLAIMING. THERE IS NO FEDERAL LAW PROVIDING $3,600 AS
MUSTERING-OUT PAY TO ANY MEMBER OF THE UNIFORMED SERVICES, INCLUDING
PHILIPPINE SCOUTS.
ANY FURTHER CORRESPONDENCE FROM YOU RELATIVE TO THE MATTER WILL BE
FILED WITHOUT FURTHER REPLY.
B-171770, MAY 18, 1971
MUSTERING OUT PAY
DENYING CLAIM FOR MUSTERING-OUT PAY BELIEVED DUE CLAIMANT'S LATE
HUSBAND, SIMPLICIO MAPANAO, INCIDENT TO HIS DISCHARGE FROM THE MILITARY
SERVICE AS A PHILIPPINE SCOUT SINCE CLAIM WAS NOT FILED IN THE GAO
WITHIN THE 10-YEAR PERIOD PRESCRIBED.
TO MRS. DELORES VDA DE MAPANAO:
WE ARE IN RECEIPT OF YOUR LETTER OF MARCH 28, 1971, RELATIVE TO YOUR
CLAIM FOR MUSTERING-OUT PAY BELIEVED DUE YOUR LATE HUSBAND, SIMPLICIO
MAPANAO, INCIDENT TO HIS DISCHARGE FROM THE MILITARY SERVICE AS A
PHILIPPINE SCOUT IN 1949. YOUR LETTER REFERS TO OUR LETTER OF FEBRUARY
16, 1971, B-171770, WHICH SUSTAINED THE ACTION OF OUR CLAIMS DIVISION IN
BARRING YOUR CLAIM FOR THE MUSTERING-OUT PAY BECAUSE IT WAS NOT RECEIVED
IN OUR OFFICE WITHIN THE 10-YEAR LIMITATION PERIOD PRESCRIBED IN THE ACT
OF OCTOBER 9, 1940, CH. 788, 54 STAT. 1061, 31 U.S.C. 71A.
IN YOUR LETTER YOU SAY THAT YOUR CLAIM SHOULD NOT BE BARRED BECAUSE
YOUR LATE HUSBAND, WHO DIED ON DECEMBER 14, 1961, HAD FILED A CLAIM FOR
SUCH PAY WITH THE ARMY FINANCE CENTER, INDIANAPOLIS, INDIANA, IN 1957.
YOU THEREFORE REQUEST THAT YOUR CLAIM BE RECONSIDERED.
THE BARRING ACT OF 1940 REQUIRES THAT A CLAIM MUST BE FILED IN THE
GENERAL ACCOUNTING OFFICE WITHIN THE 10-YEAR PERIOD PRESCRIBED.
THEREFORE, THE FILING OF A CLAIM WITH ANY OTHER AGENCY OF THE GOVERNMENT
DOES NOT MEET THE REQUIREMENTS OF THE STATUTE.
INASMUCH AS WE HAVE NO RECORD OF RECEIPT OF A CLAIM FOR MUSTERING-OUT
PAY FROM YOUR LATE HUSBAND DIRECTLY OR THROUGH THE DEPARTMENT OF THE
ARMY WITHIN 10 YEARS FROM THE DATE HE WAS DISCHARGED IN 1949, AND SINCE
YOUR CLAIM WAS FIRST RECEIVED IN OUR OFFICE ON OCTOBER 17, 1962, NEARLY
14 YEARS AFTER THE DATE HE WAS DISCHARGED, THERE IS NO FURTHER ACTION
OUR OFFICE MAY LEGALLY TAKE ON YOUR CLAIM.
B-171783, MAY 18, 1971
ANNUAL LEAVE CHARGED - DELAYED RETURN TO DUTY STATION
ADVISING THAT THE DEPARTMENT OF THE AIR FORCE HAS INFORMED THE COMP.
GEN. THAT ACTION IS BEING TAKEN TO REMOVE THE ANNUAL LEAVE CHARGED
CLAIMANT FOR THE TIME HE SPENT WAITING AT ELMENDORF AFB, FOR
TRANSPORTATION TO SHEMYA AFB DURING A 14-DAY PERIOD OF BAD WEATHER.
HOWEVER, BECAUSE CLAIMANT PERFORMED NO WORK DURING THE SUBJECT TWO
WEEK PERIOD, NO BASIS EXISTS FOR PAYMENT OF OVERTIME FOR THE SIXTH
WORKDAY OF THE TWO BASIC WORKWEEKS WHILE CLAIMANT WAITED FOR
TRANSPORTATION.
TO MR. JAMES D. BRAY:
REFERENCE IS MADE TO YOUR LETTER OF JANUARY 13, 1971, AND ENCLOSURES,
ADDRESSED TO MR. BURTON H. GOLDBERG, NATIONAL REPRESENTATIVE, AMERICAN
FEDERATION OF GOVERNMENT EMPLOYEES, WHICH WERE FORWARDED TO THIS OFFICE
FOR REPLY BY THE HONORABLE TED STEVENS, UNITED STATES SENATOR.
YOUR CLAIM IS FOR REINSTATEMENT OF ANNUAL LEAVE CHARGED TO YOU AND
FOR PAY FOR THE SIXTH WORKDAY DURING THE 2 BASIC WORKWEEKS, AUGUST 1
THROUGH AUGUST 14, 1970, WHILE RETURNING FROM RENEWAL AGREEMENT (HOME
LEAVE) TO SHEMYA AIR FORCE BASE AS A CIVILIAN EMPLOYEE OF THE DEPARTMENT
OF THE AIR FORCE.
SPECIFICALLY, YOU STATE IN YOUR LETTER, IN PERTINENT PART, AS
FOLLOWS:
"I COMPLETED TRAVEL AGREEMENT AT SHEMYA AFB, SERVICED BY THE CCPO AT
ELMENDORF AFB, ALASKA ON 19 JUNE 70. I DEPARTED SHEMYA ON 20 JUNE 70
FOR PURPOSE OF ANNUAL LEAVE AS AGREED UPON IN TRAVEL AGREEMENT. PRIOR
TO MY DEPARTURE, I SIGNED A NEW TRAVEL AGREEMENT FOR PERIOD OF ONE YEAR.
MY LEAVE PERIOD WAS FROM 22 JUNE 70 TO 31 JULY 70.
"I DEPARTED FROM HOME IN BOX ELDER, S. DAKOTA AT 1400 ON 29 JULY 70,
ARRIVING AT MCCHORD AFB ON 30 JULY 70 FOR FLIGHT TO ELMENDORF AFB,
ALASKA. I DEPARTED MCCHORD AT 0900 ON 30 JULY 70 AND ARRIVED AT
ELMENDORF AFB AT 1200 ON 30 JULY 70, AND PLACED MY NAME ON THE MANIFEST
FOR FLIGHT SCHEDULED TO DEPART ELMENDORF AFB FOR SHEMYA AFB ON SATURDAY,
1 AUGUST 70. DUE TO ADVERSE WEATHER CONDITIONS, WE DID NOT LAND AT
SHEMYA, BUT RETURNED TO ELMENDORF AFB. WE MADE ANOTHER FLIGHT ON 12
AUGUST WITH THE SAME RESULTS, RETURNING TO ELMENDORF AFB. I WAS
CONSTANTLY ALERTED FOR FLIGHT INFORMATION AND EXPERIENCED SEVERAL FLIGHT
CANCELLATIONS DURING THIS PERIOD. DURING THIS TIME I WAS ON PCS TRAVEL
ORDERS, IN TRAVEL STATUS - NO CHANGE OF ORDERS WAS MADE. I FINALLY
ARRIVED AT SHEMYA AFB AT 1715 ON 14 AUGUST 70.
"IT HAS BEEN CUSTOMARY TO CARRY AN EMPLOYEE ON THE PAYROLL AT SHEMYA
WORK WEEK SCHEDULE (48 HOUR WEEK) AFTER HAVING CHECKED IN ELMENDORF AFB
FOR SHEMYA FLIGHTS, FOR THE FIRST SCHEDULED FLIGHT THEREAFTER." YOU
FURTHER STATE THAT THE DELAY YOU EXPERIENCED IN REACHING YOUR JOB SITE
WAS THROUGH NO FAULT OF YOUR OWN AND THAT THERE WERE TWO COMMERCIAL
FLIGHTS WEEKLY ON WHICH YOU COULD HAVE FLOWN TO SHEMYA AIR FORCE BASE,
PROVIDED OFFICIALS AT ELMENDORF HAD ISSUED A TRAVEL REQUEST THEREFOR OR
HAD GIVEN YOU PERMISSION TO TRAVEL BY COMMERCIAL AIRCRAFT TO THE BASE.
THE CHARGING OF ANNUAL LEAVE IN A SITUATION SUCH AS YOURS IS
PRIMARILY A MATTER FOR CONSIDERATION BY THE DEPARTMENT OF THE AIR FORCE.
HOWEVER, WE REQUESTED A REPORT FROM THE DEPARTMENT AND HAVE ALSO BEEN
IN CONTACT INFORMALLY WITH REPRESENTATIVES OF SUCH DEPARTMENT IN REGARD
TO THE CHARGING OF ANNUAL LEAVE UNDER THE CIRCUMSTANCES RELATED. IT IS
NOW OUR UNDERSTANDING THAT ACTION IS BEING TAKEN TO REMOVE THE CHARGE
AGAINST YOUR ANNUAL LEAVE ACCOUNT FOR THE TIME YOU SPENT WAITING AT
ELMENDORF AFB FOR TRANSPORTATION ON TO SHEMYA. WE ASSUME YOU WILL BE
ADVISED TO THAT EFFECT IN DUE COURSE.
AS TO YOUR ENTITLEMENT TO PAY FOR THE SIXTH WORKDAY OF THE 2 BASIC
WORKWEEKS, AUGUST 1 THROUGH AUGUST 14, 1970, WHILE AWAITING
TRANSPORTATION TO SHEMYA, THE RECORD DISCLOSES THAT YOU PERFORMED NO
WORK DURING THIS PERIOD. SECTION 5542(A), 5 UNITED STATES CODE,
AUTHORIZES PAYMENT OF OVERTIME COMPENSATION "FOR ALL HOURS OF EMPLOYMENT
OFFICIALLY ORDERED OR APPROVED IN EXCESS OF 40 HOURS IN ANY
ADMINISTRATIVE WORKWEEK." THIS CLEARLY CONTEMPLATES THE ACTUAL
PERFORMANCE OF REQUIRED DUTY DURING THE PRESCRIBED OVERTIME PERIOD. SEE
B-51218, PUBLISHED AT 25 COMP. GEN. 151 (1945), QUESTION AND ANSWER NO.
4, COPY ENCLOSED. HENCE, THERE IS NO AUTHORIZATION FOR THE PAYMENT OF
OVERTIME COMPENSATION FOR THE 2 SIXTH WORKDAYS IN QUESTION.
B-172151, MAY 18, 1971
CIVILIAN EMPLOYEE - CHANGE OF STATION - SALE OF RESIDENCE
SUSTAINING PRIOR DECISION DENYING CLAIM OF EMPLOYEE OF DEPARTMENT OF
AGRICULTURE FOR INCIDENTAL EXPENSES INCURRED UPON TRANSFER FROM ALBANY,
CALIF., TO BELTSVILLE, MD.
SECTION 4.2G OF OMB CIRCULAR NO. A-56, ALLOWING REIMBURSEMENT OF SOME
INCIDENTAL CHARGES MADE IN CONNECTION WITH SELLING A RESIDENCE DOES NOT
ALLOW PAYMENT FOR CHARGES FOR EXTERMINATION OF TERMITES, TELEPHONE CALLS
TO AN APPRAISER AND MILEAGE FOR TRAVEL TO ATTORNEY'S OFFICE.
TO MR. DANIEL E. O'CONNELL:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 28, 1971,
APPEALING FROM OUR CLAIMS DIVISION SETTLEMENT OF DECEMBER 29, 1970,
WHICH DISALLOWED YOUR CLAIM FOR REIMBURSEMENT OF EXPENSES TOTALING
$420.65 INCURRED IN CONNECTION WITH THE SALE OF YOUR RESIDENCE IN
JANUARY 1970.
YOUR OFFICIAL DUTY STATION AS AN EMPLOYEE OF THE AGRICULTURAL
RESEARCH SERVICE, DEPARTMENT OF AGRICULTURE, WAS CHANGED FROM ALBANY,
CALIFORNIA, TO BELTSVILLE, MARYLAND, AND UNDER TRAVEL AUTHORIZATION NO.
20-38, JANUARY 2, 1969, YOU CLAIMED A TOTAL OF $1,136.35 AS EXPENSES OF
SALE OF YOUR RESIDENCE AT RICHMOND, CALIFORNIA. HOWEVER, REIMBURSEMENT
FOR THE COST OF TERMITE EXTERMINATION ($392.00), TELEPHONE CALLS TO YOUR
ATTORNEY AND TO YOUR APPRAISER ($23.01) AND MILEAGE FOR TRAVEL TO YOUR
ATTORNEY'S OFFICE ($5.64) WAS DENIED.
SECTION 4.2G OF OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO. A-56
PROVIDES IN PERTINENT PART THAT INCIDENTAL CHARGES MADE FOR REQUIRED
SERVICES IN SELLING RESIDENCES MAY BE REIMBURSABLE IF THEY ARE
CUSTOMARILY PAID BY THE SELLER OF A RESIDENCE AT THE OLD OFFICIAL
STATION. WHILE REIMBURSEMENT MAY BE AUTHORIZED FOR THE COST OF A TERMITE
INSPECTION, CHARGES MADE FOR EXTERMINATING TERMITES ARE COSTS OF HOUSE
MAINTENANCE AND ARE NOT REIMBURSABLE. THE FACT THAT YOU WERE REQUIRED
TO HAVE THIS MAINTENANCE WORK DONE SO THAT THE HOUSE WOULD BE ACCEPTABLE
UPON SALE, DOES NOT CHANGE ITS NATURE. SEE DECISION B-163801, MAY 1,
1968, COPY ATTACHED.
SECTION 4.2A OF CIRCULAR NO. A-56 PERMITS REIMBURSEMENT OF A BROKER'S
FEE OR REAL ESTATE COMMISSION PAID BY THE EMPLOYEE FOR SERVICES IN
SELLING HIS RESIDENCE. HOWEVER, THERE IS NO PROVISION FOR REIMBURSEMENT
FOR TRAVEL EXPENSES OR FOR THE COST OF TELEPHONE CALLS MADE IN
CONNECTION WITH THE SALE OF A RESIDENCE, IN LIEU OF A BROKER'S FEE OR
REAL ESTATE COMMISSION. SEE DECISION B-163709, APRIL 19, 1968, COPY
ATTACHED.
AS THERE IS NO AUTHORITY FOR REIMBURSEMENT OF COSTS TOTALING $420.65,
THE DISALLOWANCE OF DECEMBER 29, 1970, IS SUSTAINED.
B-172201, MAY 18, 1971
INDIRECT TRAVEL - FOREIGN FLAG AIRLINES
SUSTAINING PRIOR DISALLOWANCE OF CLAIM FOR $282.62 AS REIMBURSEMENT
OF THE COST OF FLIGHTS ABOARD AIRCRAFT OF FOREIGN REGISTRY INCIDENT TO
TRAVEL FROM LUBUMBASHI, CONGO TO WASHINGTON, D.C.
BECAUSE CLAIMANT'S INDIRECT ROUTE THROUGH EUROPE WAS FOR PERSONAL
CONVENIENCE, TO OBTAIN AN IMMIGRATION VISA FOR HIS NEW WIFE, THE
PROVISIONS OF 6 FOREIGN AFFAIRS MANUAL 134.2 ARE FOR APPLICATION.
THEREFORE CLAIMANT MUST BE HELD RESPONSIBLE FOR THE DOLLAR VALUE OF THE
PUBLISHED AIRLINE FARE APPLYING TO THE ROUTE SEGMENT ON WHICH HE TOOK
FOREIGN FLAG AIRLINES BECAUSE THE INDIRECT TRAVEL RESULTED IN GREATER
USE OF FOREIGN FLAG SERVICE THAN WOULD HAVE BEEN NECESSARY ON THE DIRECT
ROUTE.
TO MR. DONALD G. EDGELL:
THIS IS IN REGARD TO YOUR LETTER OF JANUARY 12, 1971, EXPRESSING
DISSATISFACTION WITH SETTLEMENT CERTIFICATE DATED JANUARY 7, 1971, BY
WHICH YOUR CLAIM FOR $282.62 AS REIMBURSEMENT OF THE COST OF FLIGHTS
ABOARD AIRCRAFT OF FOREIGN REGISTRY BETWEEN KINSHASA, CONGO, AND PARIS,
FRANCE, WAS DISALLOWED. WE HAVE RECONSIDERED YOUR CLAIM IN LIGHT OF
YOUR LETTER.
THE RECORD INDICATES THAT YOU WERE AUTHORIZED TO TRAVEL FROM
LUBUMBASHI, CONGO, TO WASHINGTON, D.C., VIA HOLLOWAY, OHIO. YOU AND
YOUR WIFE DID NOT TAKE ONE OF THE FLIGHTS ON AN AMERICAN-FLAG AIRLINE
LEAVING KINSHASA, CONGO, TWICE WEEKLY FOR NEW YORK. INSTEAD YOU FLEW
FROM KINSHASA ABOARD AN AIRLINE OF FOREIGN REGISTRY TO ROME, ITALY, FROM
WHICH YOU TRAVELED TO NICE, FRANCE, ABOARD PAN AMERICAN AIRLINES, THENCE
ON TO PARIS, FRANCE, ABOARD A FOREIGN-FLAG AIRLINE, COMPLETING THE TRIP
TO THE UNITED STATES ABOARD AMERICAN-FLAG AIRLINES. YOUR LETTER OF
APRIL 3, 1970, TO THE DEPARTMENT OF STATE INDICATES THAT YOUR REASON FOR
NOT TAKING A FLIGHT DIRECTLY TO NEW YORK WAS BECAUSE ON NOVEMBER 27,
1969, YOUR WIFE, WHOM YOU HAD MARRIED 5 DAYS PREVIOUSLY, DID NOT HAVE AN
IMMIGRATION VISA NECESSARY FOR HER ENTRY INTO THE UNITED STATES, AND
THAT ON THAT DAY YOUR VISA PERMITTING YOU TO REMAIN IN THE CONGO
EXPIRED, REQUIRING THAT YOU LEAVE THAT COUNTRY.
APPARENTLY YOU WERE ADVISED THAT A VISA FOR YOUR WIFE COULD BE
OBTAINED IN ROME, ITALY. THAT INFORMATION PROVED INCORRECT AND YOU
FINALLY DID OBTAIN A VISA IN PARIS. YOU STATE THAT YOU WERE TOLD YOUR
TRAVEL ORDERS WOULD BE AMENDED TO AUTHORIZE TRAVEL TO ROME, ITALY, FOR
THE PURPOSE OF OBTAINING A VISA, AND TO NICE, FRANCE, TO PACK HOUSEHOLD
EFFECTS. THE RECORD DOES NOT INDICATE THAT YOUR ORDERS WERE AMENDED
OTHER THAN TO AUTHORIZE TRAVEL EXPENSES FOR YOUR WIFE.
THE FOREIGN AFFAIRS MANUAL IN EFFECT AT THE TIME OF YOUR TRAVEL
PROVIDED THAT ALL OFFICIAL TRAVEL MUST BE BY A USUALLY TRAVELED ROUTE
AND THAT A TRAVELER MUST BEAR THE EXPENSE OF ANY PORTION OF HIS JOURNEY
WHEN HE DEVIATES FROM THE USUALLY TRAVELED ROUTE FOR PERSONAL
CONVENIENCE. IT IS CLEAR THAT THE INDIRECT ROUTE WHICH YOU TOOK THROUGH
EUROPE WAS NOT A MATTER OF OFFICIAL NECESSITY BUT FOR THE PURPOSE OF
ARRANGING PERSONAL AFFAIRS RELATING TO YOUR MARRIAGE AND BRINGING YOUR
NEW WIFE TO THE UNITED STATES.
THE PROVISIONS OF 6 FAM 134.2 WITH RESPECT TO TRAVEL ABOARD FOREIGN
REGISTRY AIRCRAFT VIA AN INDIRECT ROUTE IN EFFECT DURING THE TIME HERE
INVOLVED WERE AS FOLLOWS:
"134.2-2 INDIRECT TRAVEL
"WHEN AIR TRAVEL IS PERFORMED VIA AN INDIRECT ROUTE FOR THE PERSONAL
CONVENIENCE OF THE TRAVELER, A FOREIGN AIR-LINE CAN BE USED ONLY WHEN:
"A. AN AMERICAN-FLAG AIRLINE DOES NOT PROVIDE SERVICE; AND
"B. TRAVEL BY THE INDIRECT ROUTE DOES NOT RESULT IN GREATER TOTAL
USE OF FOREIGN-FLAG SERVICE THAN WOULD HAVE BEEN NECESSARY ON THE DIRECT
ROUTE
*** ." PERSONAL CIRCUMSTANCES HAVING DICTATED YOUR ROUTE THROUGH
EUROPE, THE ABOVE SECTION IS CONTROLLING WITH REGARD TO YOUR ENTITLEMENT
TO REIMBURSEMENT FOR EXPENSES IN CONNECTION WITH THAT TRAVEL. AS DIRECT
TRAVEL WOULD HAVE INVOLVED ONLY THE USE OF A FOREIGN-FLAG AIRLINE FROM
LUBUMBASHI, CONGO, TO KINSHASA, CONGO, IT IS CLEAR THAT THIS TRAVEL
RESULTED IN A GREATER TOTAL USE OF FOREIGN-FLAG SERVICE THAN WOULD HAVE
BEEN NECESSARY ON THE DIRECT ROUTE. IN THESE CIRCUMSTANCES, AND
PURSUANT TO 6 FAM 134.6, A TRAVELER WILL BE HELD RESPONSIBLE FOR THE
DOLLAR VALUE OF THE PUBLISHED AIRLINE FARE APPLYING TO THE ROUTE SEGMENT
ON WHICH HE TOOK FOREIGN-FLAG AIRLINES.
FOR THE FOREGOING REASONS, THE DISALLOWANCE OF YOUR CLAIM IS
SUSTAINED.
B-169622, MAY 17, 1971
BID PROTEST - BID RESPONSIVENESS - DEVIATIONS
DENIAL OF PROTEST OF AMERICAN MACHINE & FOUNDRY CO., AGAINST THE
AWARD OF A CONTRACT TO BRUNSWICK CORPORATION UNDER IFB ISSUED BY THE
DEPARTMENT OF THE ARMY FOR INSTALLATION AND LEASING OF BOWLING
EQUIPMENT.
ADMITTING THAT ITS BID WAS NONRESPONSIVE, PROTESTANT CONTENDS THAT
BRUNSWICK'S BID WAS ALSO NONRESPONSIVE AS THE EQUIPMENT IT OFFERED DID
NOT CONTAIN ALL THE FEATURES OF THE AMF 82-45 MODEL SPECIFIED IN THE
SOLICITATION. WHEN BIDS ARE REQUESTED WITH REFERENCE TO A BRAND NAME
ITEM, THE EQUIPMENT NEED NOT BE IDENTICAL. IF THE EQUIPMENT, AS HERE,
POSSESSES FEATURES LISTED IN THE INVITATION AS ESSENTIAL THE BID IS
RESPONSIVE.
TO ROBERT SHERIFFS MOSS, ESQ.:
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 2, 1971, REQUESTING
RECONSIDERATION OF OUR DECISION OF JANUARY 4, 1971, DENYING THE PROTEST
OF YOUR CLIENT, AMERICAN MACHINE & FOUNDRY COMPANY (AMF), AGAINST THE
AWARD OF A CONTRACT TO ANOTHER FIRM PURSUANT TO INVITATION FOR BIDS
(IFB) NO. DAHB01-70-B-A518.
THAT DECISION RELATED TO THE PROCUREMENT BY THE DEPARTMENT OF THE
ARMY, ON AN INSTALLATION AND LEASE BASIS, OF 16 AUTOMATIC PIN-SPOTTER
MACHINES TO BE DEPLOYED AS REPLACEMENTS FOR THE 16 AMF MODEL 82-30
MACHINES THEN INSTALLED ON THE BOWLING ALLEYS AT THE FORT CLAYTON AND
FORT GULICK, CANAL ZONE, BOWLING CENTERS.
THE IFB PROVIDED THAT EACH MACHINE LEASED SHOULD BE NEW, OR
REMANUFACTURED TO THE SAME STANDARDS AS A NEW MACHINE, AND MUST BE
AUTOMATIC, 10-PINSPOTTING, AMF MODEL 82-45 OR EQUAL. THE IFB ALSO
LISTED CERTAIN REQUIRED SALIENT CHARACTERISTICS IN ADDITION TO THE
"BASIC UNIT".
YOUR CLIENT OFFERED ITS MODEL 82-70 PINSPOTTER, AND THE ONLY OTHER
BIDDER, BRUNSWICK CORPORATION OF CHICAGO, OFFERED ITS MODEL A-500-1-000
PINSPOTTER (A1) AS BEING EQUAL TO THE AMF MODEL 82-45 ON THE REQUIRED
FEATURES.
FOLLOWING A FINDING BY THE CONTRACTING OFFICER THAT YOUR CLIENT'S BID
WAS NONRESPONSIVE, A TECHNICAL EVALUATION WAS PERFORMED BY THE SPECIAL
SERVICES OFFICE WHICH CONCLUDED THAT BRUNSWICK'S MODEL WAS IN FACT EQUAL
TO THE AMF 82-45 IN ALL MATERIAL RESPECTS, AND AN AWARD WAS THEREFORE
MADE TO BRUNSWICK.
OUR DECISION OF JANUARY 4, 1971, AND THE ADMINISTRATIVE REPORT UPON
WHICH IT WAS PARTIALLY PREDICATED, ESTABLISH THAT AMF'S BID WAS REJECTED
AS NONRESPONSIVE BECAUSE ITS BID FAILED TO QUOTE RENTAL CHARGES ON A
PER-GAME BASIS AS CONTEMPLATED IN THE SCHEDULE OF THE INVITATION FOR
BIDS. THIS IS CONCEDED BY YOUR LETTER OF FEBRUARY 2 IN WHICH IT IS
ADMITTED THAT AMF "PUT THE NEW MACHINES ON A BASIS DIFFERENT THAN THAT
SPECIFIED BY THE INVITATION. THIS, OF COURSE, MADE THE BID
NONRESPONSIVE." WHILE YOU CONTEND THAT THE ALLEGEDLY DEFECTIVE BRAND
NAME OR EQUAL PURCHASE DESCRIPTION "UNDOUBTEDLY CONTRIBUTED TO THE
SUBMISSION OF ITS (AMF'S) NONRESPONSIVE BID" YOU DO NOT ATTEMPT TO
ESTABLISH OR OTHERWISE DEFINE THE CAUSAL RELATIONSHIP. IN VIEW THEREOF,
AND SINCE WE CAN SEE NO WAY IN WHICH AMF'S FAILURE TO QUOTE RENTAL
CHARGES ON A PER-GAME BASIS CAN BE ATTRIBUTED TO THE ALLEGED DEFECT IN
THE PURCHASE DESCRIPTION, WE SEE NO MERIT IN THIS PORTION OF YOUR
REQUEST FOR RECONSIDERATION.
THE REMAINING CONTENTION OF YOUR LETTER OF FEBRUARY 2, SUMMARIZED IN
ESSENCE, IS THAT BRUNSWICK'S MACHINE SHOULD ALSO BE CONSIDERED
NONRESPONSIVE SINCE THE AMF 82-45 MODEL EMBODIED OTHER CHARACTERISTICS
THAN THOSE LISTED AMONG THE SALIENT CHARACTERISTICS, AND THEREFORE THE
SPECIFICATION "REQUIRED BIDDERS WHO WOULD FURNISH THE AMF MODEL 82-45,
TO BID ON SOMETHING DIFFERENT THAN BRUNSWICK DID, IN FACT, BID ON *** ."
IN THIS CONNECTION, YOUR ATTENTION IS DIRECTED TO THE LAST PARAGRAPH
OF PAGE 6 AND THE FIRST PARAGRAPH OF PAGE 7 OF OUR DECISION OF JANUARY
4, 1971, WHERE WE DECLARED THAT UNDER THE ARMED SERVICES PROCUREMENT
REGULATION AND THE DECISIONS OF OUR OFFICE, BRAND NAME OR EQUAL PURCHASE
DESCRIPTIONS ARE REQUIRED TO SET FORTH ONLY THOSE SALIENT PHYSICAL,
FUNCTIONAL AND OTHER CHARACTERISTICS OF THE REFERENCED PRODUCTS WHICH
ARE ESSENTIAL TO THE NEEDS OF THE GOVERNMENT; HENCE, THERE IS NO
REQUIREMENT FOR THE LISTING OF ALL OF THE FEATURES OF THE BRAND NAME
ITSELF, BUT ONLY AN IDENTIFICATION OF THE ESSENTIAL, REQUIRED
CHARACTERISTICS OF THE ITEM SOLICITED. ACCORDINGLY, WE STATED, A
PRODUCT OFFERED AS "EQUAL", NEED ONLY INCLUDE A BASIC UNIT, NOT
NECESSARILY INCORPORATING ALL THE FEATURES OF THE AMF MODEL 82-45 (WHICH
WOULD RENDER THE OFFERED PRODUCT IDENTICAL RATHER THAN EQUAL), BUT
INCLUDING ONLY THOSE REQUIRED SALIENT FEATURES DETERMINED TO BE
ESSENTIAL TO THE NEEDS OF THE GOVERNMENT. THESE REQUIRED SALIENT
CHARACTERISTICS, NINE IN NUMBER, WERE SET FORTH IN THE INVITATION.
WHILE WE FEEL THAT OUR DECISION OF JANUARY 4 ADDRESSED ITSELF TO THIS
PARTICULAR CONTENTION RAISED IN YOUR LETTER OF FEBRUARY 2, WE AVAIL
OURSELVES OF THIS OPPORTUNITY TO AMPLIFY OUR VIEWS ON THIS ISSUE.
IN B-169835, SEPTEMBER 18, 1970, 50 COMP. GEN. ____, OUR OFFICE
ENDORSED THE CONCEPT THAT AN OFFERED PRODUCT COULD NOT BE REJECTED FOR
FAILING TO SHOW STRICT COMPLIANCE WITH THE UNLISTED FEATURES OF A BRAND
NAME PRODUCT. HOWEVER, WE ALSO ACKNOWLEDGED THE DIFFICULTY OF EVALUATING
AN "EQUAL" PRODUCT SOLELY FROM THE STANDPOINT THAT THE SALIENT
CHARACTERISTICS LISTED CONSTITUTED A COMPLETE PURCHASE DESCRIPTION
WITHOUT A PASSING ALLUSION TO THE GENERAL DESIGN FEATURES OF THE ITEM.
THIS, WE DECLARED, IS SATISFIED BY MERELY REFERENCING THE BRAND NAME.
ACCORDINGLY, WE HOLD THE VIEW, ENTIRELY CONSISTENT WITH THE
FOREGOING, THAT THE SPECIFICATION IN THE INSTANT PROCUREMENT MERELY
DENOTED "AN AUTOMATIC 10 PINSPOTTING MACHINE" WHICH INCLUDED THE NINE
LISTED SALIENT, REQUIRED CHARACTERISTICS. THE TECHNICAL EVALUATION
ESTABLISHED THAT THE BRUNSWICK MACHINE WAS SUCH A PRODUCT, AND WE MUST
THEREFORE CONCUR THAT BRUNSWICK'S PRODUCT WAS "EQUAL", AND ITS BID WAS
RESPONSIVE, TO THE SPECIFICATION SET FORTH IN THE IFB.
IN B-157857, JANUARY 26, 1966, OUR OFFICE REJECTED THE VIEW THAT A
COMPETITOR'S PRODUCT WAS INFERIOR TO THE BRAND NAME MODEL BECAUSE IT
LACKED THE UNLISTED FEATURES OF THE BRAND NAME ITEM WHERE THE IFB DID
NOT LIST THESE FEATURES AS ESSENTIAL REQUIREMENTS:
" *** AN INVITATION WHICH FAILS TO LIST ALL THE CHARACTERISTICS
DEEMED ESSENTIAL, OR LISTS CHARACTERISTICS WHICH ARE NOT ESSENTIAL, IS
DEFECTIVE."
IN B-169210, APRIL 22, 1970, WE HELD THAT A "BRAND NAME OR EQUAL"
SPECIFICATION IS NOT CONSTRUED TO MEAN "IDENTICAL", AND THAT TO READ
SUCH A REQUIREMENT INTO THE SPECIFICATION WOULD BE TANTAMOUNT TO
OMITTING THE "OR EQUAL", THEREBY RENDERING THE SPECIFICATION UNDULY
RESTRICTIVE. YET THIS IS PRECISELY HOW THE SPECIFICATION WOULD BE
CONSTRUED IF WE WERE TO ADOPT THE INTERPRETATION WHICH YOU ATTEMPT TO
GIVE TO THE WORDS "BASIC UNIT" IN THE LAST SENTENCE ON PAGE ONE AND THE
FIRST PARAGRAPH ON PAGE TWO OF YOUR LETTER OF FEBRUARY 2, 1971.
IN VIEW THEREOF, THE SPECIFICATION WOULD HAVE BEEN DEFECTIVE HAD IT
LISTED AND REQUIRED A PRODUCT OFFERED AS AN "EQUAL" TO INCLUDE SUCH
ATTRIBUTES AS THE ELECTRO-MECHANICAL FEATURES, THE FOOL-PROOF BALL EXIT,
THE FASTER BALL RETURN TIME, AUTOMATIC FOUL RECYCLING DEVICE AND
INSTRUCTOMAT, ALL OF WHICH WOULD APPEAR TO BE CONSIDERED UNESSENTIAL TO
THE GOVERNMENT'S NEEDS. WHILE WE CAN SEE THAT DESIGNATION OF THE AMF
MODEL 82-45 MAY HAVE LED AMF TO BELIEVE THAT IT MUST OFFER EITHER THAT
MODEL OR A SUPERIOR MODEL, THE FACT REMAINS THAT AN AMF 82-30 WOULD HAVE
BEEN ACCEPTABLE UNDER THE PURCHASE DESCRIPTION IF THAT MODEL, AS
OFFERED, DID IN FACT CONTAIN ALL OF THE SALIENT CHARACTERISTICS SET OUT
IN THE PURCHASE DESCRIPTION.
WITH RESPECT TO WHETHER THE PURCHASE DESCRIPTION MIGHT MORE PROPERLY
HAVE REQUESTED MODEL 82-30 OR EQUAL, WE NOTE THAT AMF ELECTED TO OFFER
EQUIPMENT WHICH WAS SUPERIOR TO THE MODEL 82-45 SET OUT IN THE
DESCRIPTION, AND WE SEE NO REASON TO BELIEVE IT WOULD NOT ALSO HAVE
OFFERED EQUIPMENT SUPERIOR TO THE MODEL 82-30 IF THAT MODEL HAD BEEN
DESIGNATED IN THE DESCRIPTION.
WE CERTAINLY AGREE THAT THE NONRESPONSIVENESS OF AMF'S BID DOES NOT,
UNDER THE CIRCUMSTANCES HERE INVOLVED, PRECLUDE IT FROM RAISING OR BEING
ENTITLED TO A DECISION ON THE MERITS OF THE ISSUE WHETHER OR NOT
BRUNSWICK'S BID WAS RESPONSIVE, AND THE LAST PARAGRAPH OF OUR DECISION
OF JANUARY 4, 1971, WAS NOT INTENDED TO SO IMPLY.
IT IS OUR OPINION THAT THE ANALYSIS OF THIS ISSUE APPEARING AT THE
BOTTOM OF PAGE 6 AND THE BEGINNING OF PAGE 7 OF THAT DECISION, AS
AMPLIFIED BY THE DISCUSSION PRESENTED IN THIS LETTER, INDICATES A FULL
CONSIDERATION OF THE MERITS OF THE PROTEST. SINCE OUR PRESENT ANALYSIS
FAILS TO REVEAL ANY CONSIDERATION WHICH WOULD JUSTIFY OR REQUIRE US TO
ALTER THE CONCLUSIONS SET FORTH IN THAT DECISION, IT MUST BE AFFIRMED.
B-170943, MAY 17, 1971
CONTRACTS - HURRICANE DAMAGE
DECISION ALLOWING PAYMENT OF CLAIM BY GREGG, GIBSON & GREGG, INC.,
FOR REPAIR WORK ON THE CENTRAL & SOUTHERN FLORIDA FLOOD CONTROL PROJECT
INCIDENT TO DAMAGE CAUSED BY HURRICANE ABBY.
IT WOULD BE AN UNDULY NARROW CONSTRUCTION OF THE CONTRACT'S HURRICANE
DAMAGE CLAUSE TO DENY PAYMENT TO THE CONTRACTOR MERELY BECAUSE THE STORM
DID NOT MAINTAIN HURRICANE INTENSITY AS DEFINED BY THE ENVIRONMENTAL
SCIENCE SERVICES ADMINISTRATION, FOR THE INTERVENING PERIOD DURING WHICH
THE 12.22 INCHES OF RAINFALL AND ENSUING DAMAGE CONTINUED TO OCCUR.
THEREFORE, THE SUBJECT CLAIM MAY BE PAID.
TO MR. SECRETARY:
WE REFER TO A REQUEST FROM THE DISBURSING OFFICER, U.S. ARMY ENGINEER
DISTRICT, JACKSONVILLE, FLORIDA, FORWARDED BY THE ENGINEER COMPTROLLER,
FOR A DECISION AS TO WHETHER PAYMENT MAY BE MADE OF THE CLAIM OF GREGG,
GIBSON & GREGG, INC., FOR HURRICANE DAMAGE UNDER CONTRACT
DACW17-68-C-0004. THE CORPS OF ENGINEERS BOARD OF CONTRACT APPEALS
ALLOWED THE CONTRACTOR'S APPEAL FROM THE CONTRACTING OFFICER'S DENIAL OF
THE CLAIM IN ITS DECISION OF AUGUST 12, 1970, ENG BCA NO. 3051.
THE CONTRACT IN QUESTION CALLED FOR CONSTRUCTION OF LEVEE 73, SECTION
1, STRUCTURE 164 AND COX CREEK IRRIGATION STRUCTURE, ALL OF WHICH WERE
PARTS OF THE CENTRAL AND SOUTHERN FLORIDA FLOOD CONTROL PROJECT. THE
APPELLANT'S SUBCONTRACTOR, CROSS CONTRACTING COMPANY, INC. (CROSS), THE
REAL PARTY IN INTEREST, HAD PLACED THE EMBANKMENT, EXCEPT FOR GRASS
COVER, FOR STRUCTURE 164 BY EARLY JUNE 1968. THE EMBANKMENT WAS
THEREAFTER ERODED BY TORRENTIAL RAINS ASSOCIATED WITH TROPICAL CYCLONE
"ABBY."
PARAGRAPH SP-17 OF THE CONTRACT AUTHORIZES ADDITIONAL PAYMENT TO THE
CONTRACTOR FOR REPAIRS TO PERMANENT WORK DAMAGED BY FLOOD, EARTHQUAKE,
HURRICANE OR TORNADO. THE WORD "HURRICANE" IS NOT DEFINED IN THE
CONTRACT.
IN ITS DECISION, THE BOARD RELIES PRIMARILY ON THE DEFINITIONS IN THE
1969 PUBLICATION BY THE U.S. DEPARTMENT OF COMMERCE, ENVIRONMENTAL
SCIENCE SERVICES ADMINISTRATION (ESSA) ENTITLED "THE GREATEST STORM ON
EARTH ... HURRICANE." THIS PUBLICATION WAS BEFORE THE BOARD AS A PART OF
THE RULE 4 PAPERS. ESSA DEFINES TROPICAL CYCLONES AS FOLLOWS:
"TROPICAL CYCLONE CLASSIFICATION
BY INTERNATIONAL AGREEMENT, TROPICAL CYCLONE IS THE GENERAL TERM FOR
ALL CYCLONIC CIRCULATIONS ORIGINATING OVER TROPICAL WATERS, CLASSIFIED
BY FORM AND INTENSITY AS FOLLOWS:
TROPICAL DISTURBANCE: ROTARY CIRCULATION SLIGHT OR ABSENT AT SURFACE
BUT SOMETIMES BETTER DEVELOPED ALOFT, NO CLOSED ISOBARS (LINES OF EQUAL
ATMOSPHERIC PRESSURE) AND NO STRONG WINDS, A COMMON PHENOMENON IN THE
TROPICS.
TROPICAL DEPRESSION: ONE OR MORE CLOSED ISOBARS AND SOME ROTARY
CIRCULATION AT SURFACE, HIGHEST WIND SPEED 39 MILES PER HOUR (34 KNOTS).
TROPICAL STORM: CLOSED ISOBARS, DISTINCT ROTARY CIRCULATION, HIGHEST
WIND SPEED 39-73 MILES PER HOUR (34-63 KNOTS).
HURRICANE: CLOSED ISOBARS, STRONG AND VERY PRONOUNCED ROTARY
CIRCULATION, WIND SPEED OF 74 MILES PER HOUR (64 KNOTS) OR MORE."
THE BOARD FOUND THAT ABBY GOT HER START IN A CLOUD MASS OFF THE
NORTHERN COAST OF HONDURAS AS THE MONTH OF MAY 1968 CLOSED. ABBY WAS
BORN ON JUNE 1 AND BECAME A TROPICAL STORM ON JUNE 2 BEFORE CROSSING THE
WESTERN TIP OF CUBA. SHE BECAME A HURRICANE ON THE 3RD WHEN WINDS
REACHED MINIMAL HURRICANE FORCE NEAR HER CENTER. MIAMI WEATHER BUREAU
HURRICANE ADVISORY NUMBER 8, ISSUED AT 6 A.M., EDT, JUNE 4, STATED "ABBY
IS JUST BARELY OF HURRICANE FORCE" WITH GALES EXTENDING OUT 150 MILES
EAST AND NORTH OF THE CENTER. ADVISORY NUMBER 9, ISSUED AT 12 NOON,
EDT, JUNE 4, STATED THAT ABBY (APPARENTLY THE STORM'S EYE OR CENTER)
CROSSED THE FLORIDA COAST NEAR PUNTA GORDA AROUND 9 A.M., EDT, WITH
STRONGEST WINDS LITTLE MORE THAN 40 MPH. ON THE 4TH AND 5TH, ABBY MOVED
SLOWLY EAST-NORTHEASTWARD ACROSS CENTRAL FLORIDA RELEASING HEAVY RAINS.
ON THE 5TH, ABBY REINTENSIFIED SLIGHTLY OFF CAPE KENNEDY, THEN MOVED
NORTHWARD ALONG THE JACKSONVILLE BEACHES ON THE 6TH. IT WAS ON THE 6TH
THAT JACKSONVILLE RECORDED 45 KNOT WINDS WITH 57 KNOT GUSTS - THE
HIGHEST FIGURES FROM ANY LAND STATION. HOWEVER, RECONNAISSANCE AIRCRAFT
RECORDED 67 KNOT WINDS WHICH EXCEEDED THE 64 KNOT WINDS REQUIRED FOR A
HURRICANE CLASSIFICATION. ABBY MOVED NORTHWARD AND WEAKENED AND DIED
WHILE CROSSING GEORGIA AND THE CAROLINAS.
JOBSITE RECORDS FOR JUNE 3 SHOW THAT WORKDAY AS PARTLY CLOUDY AND
SUITABLE FOR WORK. RAINFALL READINGS MADE AT 8 A.M. EACH DAY AT THE
JOBSITE SHOW 5.00 INCHES OF RAIN FOR THE READING ON THE 4TH, 4.05 INCHES
FOR THE READING ON THE 5TH AND 3.17 INCHES FOR THE READING ON THE 6TH -
A TOTAL OF 12.22 INCHES OF RAINFALL AT THE JOBSITE IN THE PERIOD
CONCERNED. THIS RAIN ERODED THE EMBANKMENT OF STRUCTURE 164. CROSS
REPAIRED THE DAMAGE AND FILED A CLAIM FOR THE COST OF THE REPAIRS.
BASED ON ESSA'S TROPICAL CYCLONE CLASSIFICATION, THE CONTRACTING
OFFICER MADE A FINDING THAT THE TROPICAL DISTURBANCE IDENTIFIED AS
"ABBY" WAS NOT IN FACT A "HURRICANE" WHEN IT CROSSED THE LAND AREAS OF
FLORIDA AND THEREFORE HE DENIED THE CLAIM ON THE BASIS THAT THE WORK WAS
DAMAGED BY A TROPICAL STORM INSTEAD OF A HURRICANE AS SPECIFIED IN THE
CONTRACT.
THE BOARD NOTED THAT ESSA TREATS A HURRICANE, NOT AS A PHENOMENON
WHICH SPRINGS FORTH FULLY MATURE OR EXPIRES INSTANTANEOUSLY, BUT AS A
CREATURE HAVING A LIFE CYCLE CONSISTING OF BIRTH, GROWTH, MATURITY,
DECLINE AND DEATH. THE BOARD ALSO NOTED THAT ON PAGE 16 OF THE
TREATISE, ESSA STATES THAT WIND IS THE LEAST DESTRUCTIVE AND LEAST
LETHAL OF THE HURRICANE'S BATTERY OF DESTRUCTIVE ELEMENTS AND FLOODS
PRODUCED BY HURRICANE RAINFALL ARE MORE DESTRUCTIVE THAN WINDS. THE
BOARD QUOTED FROM PAGE 15 OF THE ESSA TREATISE:
"OVER LAND, A HURRICANE DECAYS RAPIDLY. WITHOUT ITS HEAT SOURCE, AND
WITH THE ADDED EFFECTS OF FRICTIONAL DRAG, THE CIRCULATION IS RAPIDLY
DESTROYED. HURRICANE RAINS, HOWEVER, MAY CONTINUE EVEN AFTER THE WINDS
ARE MUCH DEPLETED. IT HAS BEEN ESTIMATED THAT HURRICANE RAINFALL - WITH
OR WITHOUT DESTRUCTIVE WINDS - ACCOUNTS FOR NEARLY A FOURTH OF THE
SOUTHEASTERN UNITED STATES ANNUAL PRECIPITATION."
THE BOARD STATED ITS OPINION THAT THE DAMAGE TO THE EMBANKMENT WAS
CAUSED BY A HURRICANE WITHIN THE CONTEMPLATION OF THE CONTRACT, AND
DECIDED THAT THE CONTRACT INTENDED THAT PAYMENT WOULD BE MADE ON ACCOUNT
OF DAMAGE CAUSED BY A HURRICANE IN ITS DECLINING STAGE AS WELL AS ITS
MATURE STAGE.
THE BOARD REJECTED THE CONTRACTING OFFICER'S INTERPRETATION, WHICH I
STATED WOULD DENY RELIEF WHEN DAMAGE IS MOST LIKELY TO OCCUR.
THE SOLE ISSUE IN THIS CASE IS WHETHER THE DAMAGE CAUSED BY THE 12.22
INCHES OF RAINFALL WAS DAMAGE BY A HURRICANE WITHIN THE CONTEMPLATION OF
THE CONTRACT. IN ESSA'S DESCRIPTION OF A HURRICANE IT IS STATED:
"IT STANDS UPON THE SEA AS A WHIRLWIND OF AWFUL VIOLENCE. ON
AVERAGE, ITS GREAT SPIRAL COVERS AN AREA SOME 100 MILES IN DIAMETER WITH
WINDS GREATER THAN 74 MILES PER HOUR, AND SPREADS GALE-FORCE WINDS -
WINDS ABOVE 40 MILES PER HOUR - OVER A 400-MILE-DIAMETER AREA. ITS
CYCLONIC SPIRAL IS MARKED BY HEAVY CLOUD BANDS FROM WHICH TORRENTIAL
RAINS FALL, SEPARATED BY AREAS OF LIGHT RAIN OR NO RAIN AT ALL *** " IT
IS NOT CONTENDED THAT ANY PART OF THE 12.22 INCHES OF RAIN WHICH FELL AT
THE JOBSITE WAS NOT ASSOCIATED WITH, OR A PRODUCT OF, ABBY.
AS STATED ABOVE, THE MIAMI WEATHER BUREAU HURRICANE ADVISORY NUMBER
8, ISSUED AT 6 A.M., EDT, JUNE 4, 1968, DESCRIBED ABBY AS BEING OF
HURRICANE FORCE, AND BY 8 A.M. OF THAT DAY 5 INCHES OF RAIN HAD FALLEN
AT THE JOBSITE WITHIN THE PRIOR 24 HOUR PERIOD. WHILE HURRICANE
ADVISORY NUMBER 9, ISSUED AT 12 NOON, EDT, JUNE 4, 1968, ADVISED THAT
ABBY (THE CENTER) CROSSED THE FLORIDA COAST AROUND 9 A.M. ON THAT DATE
WITH WINDS DIMINISHED TO 40 MILES PER HOUR, THE BOARD FURTHER FOUND THAT
ABBY REINTENSIFIED SLIGHTLY ON THE 5TH AND THAT ON THE 6TH
RECONNAISSANCE AIRCRAFT RECORDED WINDS OF 67 KNOTS, OR 3 KNOTS ABOVE
HURRICANE INTENSITY.
BASED ON THE PRESENT RECORD, AND WITH ABBY HAVING BEEN OF HURRICANE
INTENSITY DURING THE BEGINNING AND THE ENDING OF THE APPROXIMATELY
THREE-DAY PERIOD OF RAIN IN WHICH THE DAMAGE OCCURRED, WE BELIEVE THAT
THE DAMAGE MUST BE ATTRIBUTED TO THE HURRICANE, AND IS THEREFORE COVERED
BY PARAGRAPH SP-17 OF THE CONTRACT. IN THIS PARTICULAR SITUATION, WE
THINK IT WOULD BE AN UNDULY NARROW CONSTRUCTION OF THE HURRICANE DAMAGE
CLAUSE TO CONSTRUE IT AS DENYING PAYMENT TO THE CONTRACTOR MERELY
BECAUSE THE STORM DID NOT MAINTAIN HURRICANE INTENSITY FOR THE
INTERVENING PERIOD DURING WHICH THE RAINFALL AND ENSUING DAMAGE
CONTINUED TO OCCUR.
FOR THE REASONS STATED, THE SUBJECT CLAIM MAY BE PAID, IF OTHERWISE
PROPER, PURSUANT TO THE BOARD'S DECISION THAT THE DAMAGE TO THE
EMBANKMENT WAS CAUSED BY HURRICANE WITHIN THE CONTEMPLATION OF THE
CONTRACT.
THE FILE SUBMITTED WITH THE REQUEST FOR A DECISION IS RETURNED.
B-171562(1), MAY 17, 1971
BID PROTEST - LOWEST OVERALL COST - LABOR RATE
DENYING PROTEST OF DYNAMIC SYSTEMS INTERNATIONAL AGAINST THE AWARD TO
DYNALECTRON CORP., OF A CONTRACT FOR MAINTENANCE AND REPAIR AS REQUIRED
ON COMMERCIAL CONSTRUCTION EQUIPMENT LOCATED IN VIETNAM UNDER AN RFP
ISSUED BY THE U.S. ARMY MOBILITY EQUIPMENT COMMAND.
SELECTION OF A CONTRACTOR WHOSE PERFORMANCE WILL MOST LIKELY RESULT
IN THE LOWEST OVERALL COST TO THE GOVERNMENT REQUIRED CONSIDERATION OF
SUCH FACTORS AS AVAILABILITY OF SKILLED AND QUALIFIED PERSONNEL AND THE
PROPOSED MANAGEMENT PLAN; TO SELECT A CONTRACTOR SOLELY ON THE BASIS OF
THE LOWEST LABOR RATE AS PROTESTANT CONTENDS SHOULD HAVE BEEN DONE WOULD
PROVIDE NO ASSURANCE THAT THE OVERALL COST WOULD BE LOWEST.
TO DYNAMIC SYSTEMS INTERNATIONAL, LTD.:
FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST THE AWARD OF A
CONTRACT TO DYNALECTRON CORPORATION BY THE UNITED STATES ARMY MOBILITY
EQUIPMENT COMMAND (MECOM) PURSUANT TO REQUEST FOR QUOTATIONS NO.
DAAK01-Q-1191.
THE RFQ, ISSUED ON AUGUST 4, 1970, WITH A CLOSING DATE OF SEPTEMBER
15, 1970, SOLICITED QUOTATIONS FOR FURNISHING THE WORK AND SERVICES
NECESSARY TO ACCOMPLISH TEARDOWN, ANALYSIS, ENGINEERING EVALUATIONS,
MAINTENANCE, OVERHAUL, REPAIR, REWORK AND MODIFICATION AS REQUIRED ON
COMMERCIAL CONSTRUCTION EQUIPMENT LOCATED IN THE REPUBLIC OF VIETNAM.
THE RFQ WAS ISSUED TO 41 FIRMS AND 12 TIMELY RESPONSES WERE RECEIVED.
AWARD WAS MADE TO DYNALECTRON ON DECEMBER 4, 1970, FOR THE PERIOD
THROUGH JUNE 30, 1971, WITH AN OPTION TO EXTEND PERFORMANCE FOR TWO
YEARS.
YOU CONTEND THAT THE AWARD TO DYNALECTRON WAS ERRONEOUS FOR THE
FOLLOWING REASONS:
"(A) DEVIATION FROM THE PRESCRIBED REGULATION OF ASPR FOR EVALUATING
THE TIME AND MATERIAL CONTRACT CALLED FOR IN REFERENCE (A) IN THAT MECOM
EVALUATED THE PROPOSAL AS IF A FIXED PRICE CONTRACT WERE CALLED FOR.
"(B) GROSS ERROR IN THE EVALUATION OF COST IN THAT IT IMPROPERLY
REQUIRED THE INJECTION OF AN UNCERTAIN ELEMENT (TOTAL LABOR HOURS)
PERMITTING THE WINNER TO PREVAIL WITH CONSIDERABLY HIGHER LABOR RATES
AND AN UNCERTAIN ESTIMATE OF FEWER TOTAL LABOR HOURS.
"(C) BAD FAITH ON MECOM'S PART IS NECESSARILY IMPLIED IN THAT IT SET
EVALUATION GUIDELINES UNFAIRLY FAVORING THE WINNER AND COMMITTED THE
GROSSLY ERRONEOUS COST EVALUATION OF (B)." IT IS YOUR CONTENTION THAT
THE AWARD TO DYNALECTRON AT ITS HIGHER LABOR RATES WILL RESULT IN THE
GOVERNMENT PAYING AN ADDITIONAL $337,700 FOR PERFORMANCE THROUGH JUNE
30, 1971, AND AN ADDITIONAL $675,400 PER YEAR IF THE OPTION IS
EXERCISED.
IT IS REPORTED THAT THE SUBJECT CONTRACT IS A CONTINUATION OF THE
SAME SERVICES PROVIDED UNDER A PREVIOUS CONTRACT WITH DYNALECTRON.
SINCE THERE WAS NO WAY TO PROJECT THE EXTENT OF THE WORK THAT WOULD BE
INVOLVED, IT WAS DETERMINED THAT A TIME AND MATERIALS CONTRACT WOULD BE
THE MOST APPROPRIATE TYPE TO USE. FURTHER, IT WAS DECIDED THAT IN VIEW
OF THE USE OF A TIME AND MATERIALS CONTRACT AND THE HIGHLY SENSITIVE
WORK INVOLVED, GREATER EMPHASIS SHOULD BE PLACED ON THE CAPABILITY OF
THE PROSPECTIVE CONTRACTOR TO PERFORM THAN ON THE LABOR RATES, PER DIEM
RATES, AND ESTIMATED TRANSPORTATION COSTS QUOTED. THEREFORE, THE RFQ
PROVIDED THAT IN THE EVALUATION, "PRIME CONSIDERATION WILL BE GIVEN TO
THE FOLLOWING FACTORS IN DESCENDING ORDER OF IMPORTANCE:"
"D 2.
"A. AVAILABILITY OF SKILLED AND QUALIFIED PERSONNEL (QUANTITY AND
CATEGORY ON HAND AND THOSE TO BE EMPLOYED).
"B. CONTRACTOR'S PROPOSED MANAGEMENT PLAN FOR THE CONTRACT TO
INCLUDE:
(1) MAN-LOADING, INCLUDING SUPERVISORY, MANAGEMENT AND OPERATIONAL
PERSONNEL.
(2) REPAIR PARTS SUPPLY SYSTEM.
(3) SYSTEM FOR CONTROL OF GOVERNMENT-FURNISHED PARTS, PROPERTY,
EQUIPMENT, ETC.
(4) CONTRACTOR'S RECOGNITION OF THE PROBLEMS INHERENT IN THE NATURE
AND LOCATION OF THE PROPOSED WORK AND SERVICES, TO INCLUDE
IDENTIFICATION OF CRITICAL PROBLEM AREAS AND PROPOSED SOLUTIONS.
"C. CONTRACTOR'S PAST EXPERIENCE ON MAINTENANCE AND REPAIR OF
SIMILAR CONSTRUCTION EQUIPMENT.
"D. OFFEROR'S LABOR RATES, PER DIEM RATES AND ESTIMATED
TRANSPORTATION COSTS.
"D 4. THE GOVERNMENT, AFTER EVALUATION OF ALL FACTORS OUTLINED
ABOVE, INTENDS TO AWARD A CONTRACT TO THE CONTRACTOR WHOSE OFFER IS THE
MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS
CONSIDERED."
IN ADDITION, SECTION D REQUIRED SUBMISSION OF, AMONG OTHER THINGS, A
PRICING PROPOSAL IN TWO PARTS SHOWING (1) STRAIGHT TIME AND OVERTIME
HOURLY RATES FOR EACH LABOR CLASSIFICATION SPECIFIED AND (2) A BREAKDOWN
OF THE TOTAL ESTIMATED COST FOR THE ENTIRE PROJECT, TO INCLUDE LABOR,
TRAVEL, PER DIEM AND OTHER DIRECT AND INDIRECT COSTS; A PROGRAM
MANAGEMENT PLAN SHOWING THE APPROACH OR METHOD OF ACCOMPLISHING THE
WORK; PROPOSED MAN-LOADING BY NUMBER AND LABOR CLASSIFICATION FOR EACH
SERVICE LOCATION SPECIFIED BASED ON THE LIST OF EQUIPMENT AT EACH SITE;
AND PROPOSED TOTAL MAN-LOADING BY NUMBER AND CLASSIFICATION FOR THE
ENTIRE PROJECT; AND PERSONNEL RESUMES FOR EMPLOYEES IN EIGHT
CLASSIFICATIONS. THE RFQ SPECIFIED 26 SITES WHERE PERFORMANCE WOULD BE
REQUIRED, AND CONTAINED A LIST OF THE NUMBER, TYPE AND LOCATION OF THE
EQUIPMENT. AMENDMENT 1 TO THE RFQ INCLUDED THE FOLLOWING PROVISION
CONCERNING EVALUATION OF COST:
"THE COST CRITERIA TO BE USED IN EVALUATION WILL BE THE TOTAL
ESTIMATED COST TO THE GOVERNMENT, WHICH WILL BE COMPUTED BY APPLYING THE
CONTRACTOR'S PROPOSED PER DIEM RATES AND LABOR BILLING RATES TO
CONTRACTOR'S PROPOSED STAFFING. CONTRACTOR'S PROPOSED OTHER FORESEEABLE
COST WILL ALSO BE A CRITERIA WHICH WILL BE USED TO ARRIVE AT A TOTAL
ESTIMATED COST FOR THE SERVICES."
AFTER RECEIPT OF THE QUOTATIONS, A CONTRACTING OFFICER'S TEAM
PERFORMED A TECHNICAL EVALUATION DURING THE PERIOD SEPTEMBER 21 THROUGH
OCTOBER 8, 1970, IN ACCORDANCE WITH THE EVALUATION PLAN DEVELOPED PRIOR
THERETO. THE TECHNICAL EVALUATION WAS BASED ON THE FACTORS LISTED IN
SECTION D 2 A, B AND C, AND APPLICATION THERETO OF WEIGHTS OF 40, 30 AND
20 PERCENT, RESPECTIVELY, AS ESTABLISHED IN THE EVALUATION PLAN. THE
FOLLOWING RANKING RESULTED FROM THE INITIAL EVALUATION:
RANKING FIRM POINTS
1 DYNALECTRON 368.96
2 6 360.96
3 7 340.52
4 3 333.60
5 2 287.44
6 9 225.68
7 1 204.68
8 8 191.58
9 4 168.30
10 11 160.92
11 DYNAMIC 137.18
12 10 92.68
THE EVALUATION TEAM CONCLUDED THAT THE FIRST FOUR FIRMS WERE IN THE
ZONE OF CONSIDERATION. HOWEVER, AS REQUIRED BY THE EVALUATION PLAN, THE
REPORT INCLUDED INFORMATION AS TO THE WEAKNESSES IN EACH QUOTATION.
DURING THE PERIOD OCTOBER 19 THROUGH NOVEMBER 9, 1970, THE CONTRACTING
OFFICER CONDUCTED NEGOTIATIONS WITH ALL 12 FIRMS AND THEY WERE ADVISED
OF THEIR RESPECTIVE AREAS OF WEAKNESS AND AFFORDED AN OPPORTUNITY TO
MAKE REVISIONS. AFTER REVISIONS WERE MADE, THE QUOTATIONS WERE
REEVALUATED. THE RANKING REMAINED THE SAME THROUGH FIRM NUMBER NINE.
YOUR POINT TOTAL INCREASED TO 146.48 AND DYNALECTRON'S POINT TOTAL
INCREASED TO 375.46. THE EVALUATED ESTIMATED COST OF YOUR QUOTATION WAS
$2,172,453.20 AND DYNALECTRON'S WAS $1,531,703.20. DYNALECTRON'S
ESTIMATED COST WAS THE LOWEST OF THE SIX HIGHEST TECHNICALLY RANKED
QUOTATIONS. SUBSEQUENT TO THE FINAL TECHNICAL EVALUATION, A 10 PERCENT
WEIGHT FACTOR WAS APPLIED TO COST. THE LOW QUOTATION WAS ASSIGNED THE
MAXIMUM OF 10 PERCENT AND A PERCENTAGE RATIO BETWEEN THAT QUOTATION AND
THE OTHERS WAS ESTABLISHED. THE RESPECTIVE SCORES FOR COST WERE ADDED
TO THE TECHNICAL POINT SCORES WITH NO RESULTING CHANGE IN THE RANKINGS.
THE SUBJECT PROCUREMENT WAS NEGOTIATED PURSUANT TO 10 U.S.C.
2304(A)(10), AS IMPLEMENTED BY PARAGRAPH 3-210.2(VIII) OF THE ARMED
SERVICES PROCUREMENT REGULATION (ASPR). SECTION 2302, TITLE 10 U.S.C.,
DEFINES THE TERM "NEGOTIATE" AS MEANING TO "MAKE WITHOUT FORMAL
ADVERTISING." IN A NEGOTIATED PROCUREMENT, THE RULES OF FORMALLY
ADVERTISED, COMPETITIVE BIDDING, SUCH AS THE REQUIREMENT FOR AWARD TO
THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER, ARE NOT CONTROLLING AND A
CONTRACTING OFFICER MAY PROPERLY TAKE INTO CONSIDERATION ALL FACTORS
DEEMED ESSENTIAL TO THE PROCUREMENT GOAL. THE GOAL OF THIS PROCUREMENT
WAS TO PROCURE AN INDEFINITE AND INDETERMINABLE AMOUNT OF SPECIFIED
SERVICES FROM A RESPONSIBLE SOURCE AT FAIR AND REASONABLE PRICES
CALCULATED TO RESULT IN THE LOWEST ULTIMATE OVERALL COST TO THE
GOVERNMENT. SEE ASPR 3-801.1. IN THIS CONNECTION, ASPR 3-806(A) STATES
THAT "THE OBJECTIVE OF THE CONTRACTING OFFICER SHALL BE TO NEGOTIATE
FAIR AND REASONABLE PRICES IN WHICH DUE WEIGHT IS GIVEN TO ALL RELEVANT
FACTORS, INCLUDING THOSE IN 3-101." ASPR 3-101 STATES THAT WHEN
NEGOTIATIONS ARE ENTERED INTO, DUE ATTENTION SHALL BE GIVEN TO A NUMBER
OF FACTORS, INCLUDING "CONSIDERATION OF THE SOUNDNESS OF PROSPECTIVE
CONTRACTORS' MANAGEMENT OF LABOR RESOURCES, INCLUDING WAGE RATES, NUMBER
OF WORKERS AND TOTAL ESTIMATED LABOR HOURS."
IT IS OUR OPINION THAT UNDER THE FOREGOING PRINCIPLES, AND IN VIEW OF
THE NATURE OF THE SERVICES BEING PROCURED, AND THE TYPE OF CONTRACT
INVOLVED, SELECTION OF A CONTRACTOR WHOSE PERFORMANCE WOULD LIKELY
RESULT IN THE LOWEST OVERALL COST TO THE GOVERNMENT REQUIRED
CONSIDERATION OF AND EVALUATION IN ACCORDANCE WITH SUCH FACTORS AS WERE
INCLUDED IN SECTION D 2 OF THE RFQ. TO SELECT THE CONTRACTOR SOLELY ON
THE BASIS OF THE LOWEST LABOR RATE, AS YOU CONTEND SHOULD HAVE BEEN
DONE, WOULD PROVIDE NO ASSURANCE THAT THE OVERALL COST WOULD BE THE
LOWEST. IN THIS CONNECTION, THE CONTRACTING OFFICER REPORTS THAT YOU
PROPOSED USING ALMOST TWICE THE NUMBER OF PERSONNEL TO PERFORM THE SAME
PROJECT AS DYNALECTRON. THE NUMBER OF PERSONNEL PROPOSED BY DYNALECTRON
WAS IN LINE WITH BOTH THE GOVERNMENT'S ESTIMATE AND THE NUMBER OF
PERSONNEL ACTUALLY REQUIRED IN PERFORMANCE OF THE PREVIOUS CONTRACT.
THIS OVERLOADING OF PROPOSED MANPOWER NOT ONLY ACCOUNTS FOR THE
CONSIDERABLY HIGHER ESTIMATED COST OF YOUR QUOTATION PREVIOUSLY NOTED,
BUT ALSO INDICATES A LACK OF UNDERSTANDING OF THE PROJECT AND WORK
REQUIREMENTS. SEE B-170027, OCTOBER 20, 1970.
CONCERNING YOUR CONTENTION THAT THE WEIGHTS OF VARIOUS FACTORS WERE
NOT DISCLOSED, WE HAVE HELD THAT OFFERORS SHOULD BE INFORMED OF THE
RELATIVE WEIGHT OR IMPORTANCE ATTACHED TO EACH FACTOR. 49 COMP. GEN.
229 (1969). THE RFQ WAS DEFICIENT IN THIS RESPECT. HOWEVER, IN VIEW OF
THE RELATIVELY LOW TECHNICAL SCORE RECEIVED BY YOUR FIRM AND THE
CONSIDERABLY GREATER ESTIMATED COST OF YOUR QUOTATION, WE DO NOT BELIEVE
YOU WERE PREJUDICED BY THIS DEFICIENCY. SEE B-169764, DECEMBER 23,
1970; B-170449, NOVEMBER 17, 1970. FURTHERMORE, WE SEE NO BASIS FOR
CONCLUDING THAT THE EVALUATION FACTORS WERE DESIGNED TO FAVOR
DYNALECTRON.
ACCORDINGLY, THERE IS NO BASIS FOR OUR OFFICE TO DISTURB THE AWARD AS
MADE.
B-171562(2), MAY 17, 1971
BID PROTEST - LOWEST OVERALL COST - EVALUATION CRITERIA
DENYING PROTEST OF SPACE AGE ENGINEERING, INC., AGAINST THE AWARD TO
DYNALECTRON CORP., OF A CONTRACT FOR MAINTENANCE AND REPAIR AS REQUIRED
ON COMMERCIAL CONSTRUCTION EQUIPMENT LOCATED IN VIETNAM UNDER AN RFP
ISSUED BY THE U.S. ARMY MOBILITY EQUIPMENT COMMAND.
PROTESTANT'S CLAIM THAT SINCE ALL RANKING PROPOSERS WERE CONSIDERED
TECHNICALLY QUALIFIED, THE DETERMINATIVE EVALUATION FACTOR SHOULD HAVE
BEEN COST WILL NOT STAND. IN VIEW OF THE NATURE OF THE SERVICES BEING
PROCURED AND THE TYPE OF CONTRACT CONTEMPLATED, THE CONTRACTING OFFICER
PROPERLY CONCLUDED THAT AWARD TO THE RESPONSIBLE FIRM QUOTING THE LOWEST
ESTIMATED COST WAS NOT NECESSARILY THE MOST ADVANTAGEOUS. MOREOVER, THE
RFQ INCLUDED REQUIREMENTS FOR SUBMISSION OF RELEVANT FACTORS IN ADDITION
TO COST, AND INDICATED THAT THESE OTHER FACTORS WERE OF GREATER
IMPORTANCE IN SELECTION OF THE CONTRACTOR.
TO SPACE AGE ENGINEERING, INCORPORATED:
FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST THE AWARD OF A
CONTRACT TO DYNALECTRON CORPORATION BY THE UNITED STATES ARMY MOBILITY
EQUIPMENT COMMAND (MECOM), PURSUANT TO REQUEST FOR QUOTATIONS NO.
DAAK01-Q-1191.
THE RFQ, ISSUED ON AUGUST 4, 1970, WITH A CLOSING DATE OF SEPTEMBER
15, 1970, SOLICITED QUOTATIONS FOR FURNISHING THE WORK AND SERVICES
NECESSARY TO ACCOMPLISH TEARDOWN, ANALYSIS, ENGINEERING EVALUATIONS,
MAINTENANCE, OVERHAUL, REPAIR, REWORK AND MODIFICATION AS REQUIRED ON
COMMERCIAL CONSTRUCTION EQUIPMENT LOCATED IN THE REPUBLIC OF VIETNAM.
THE RFQ WAS ISSUED TO 41 FIRMS AND 12 TIMELY RESPONSES WERE RECEIVED.
AWARD WAS MADE TO DYNALECTRON ON DECEMBER 4, 1970, FOR THE PERIOD
THROUGH JUNE 30, 1971, WITH AN OPTION TO EXTEND PERFORMANCE FOR TWO
YEARS.
YOU CONTEND THAT SINCE ALL 12 QUOTERS WERE CONSIDERED TECHNICALLY
COMPETENT THE DETERMINATIVE EVALUATION FACTOR SHOULD HAVE BEEN COST;
THAT AWARD TO YOUR FIRM WOULD HAVE RESULTED IN A SAVING OF ABOUT
$100,000 FOR THE BASIC CONTRACT, AND ABOUT $500,000 IF THE OPTION IS
EXERCISED; THAT THE EVALUATION FACTORS WERE NOT SUFFICIENTLY DEFINED
AND THE WEIGHTS WERE NOT DISCLOSED; THAT YOUR USE OF ALL UNITED STATES
CITIZENS AS OPPOSED TO THE CONTRACTOR'S USE OF SOME LOCAL NATIONALS
WOULD RESULT IN SUPERIOR PERFORMANCE; AND THAT CERTAIN OF THE
CONCLUSIONS OF THE EVALUATORS WITH RESPECT TO YOUR PERSONNEL WERE
ERRONEOUS.
IT IS REPORTED THAT THE SUBJECT CONTRACT IS A CONTINUATION OF THE
SAME SERVICES PROVIDED UNDER A PREVIOUS CONTRACT WITH DYNALECTRON. SINCE
THERE WAS NO WAY TO PROJECT THE EXTENT OF THE WORK THAT WOULD BE
INVOLVED, IT WAS DETERMINED THAT A TIME AND MATERIALS CONTRACT WOULD BE
THE MOST APPROPRIATE TYPE TO USE. FURTHER, IT WAS DECIDED THAT IN VIEW
OF THE USE OF A TIME AND MATERIALS CONTRACT AND THE HIGHLY SENSITIVE
WORK INVOLVED, GREATER EMPHASIS SHOULD BE PLACED ON THE CAPABILITY OF
THE PROSPECTIVE CONTRACTOR TO PERFORM THAN ON THE LABOR RATES, PER DIEM
RATES, AND ESTIMATED TRANSPORTATION COSTS QUOTED. THEREFORE, THE RFQ
PROVIDED THAT IN THE EVALUATION "PRIME CONSIDERATION WILL BE GIVEN TO
THE FOLLOWING FACTORS IN DESCENDING ORDER OF IMPORTANCE:"
"D 2
"A. AVAILABILITY OF SKILLED AND QUALIFIED PERSONNEL (QUANTITY AND
CATEGORY ON HAND AND THOSE TO BE EMPLOYED).
"B. CONTRACTOR'S PROPOSED MANAGEMENT PLAN FOR THE CONTRACT TO
INCLUDE:
(1) MAN-LOADING, INCLUDING SUPERVISORY, MANAGEMENT AND OPERATIONAL
PERSONNEL.
(2) REPAIR PARTS SUPPLY SYSTEM.
(3) SYSTEM FOR CONTROL OF GOVERNMENT-FURNISHED PARTS, PROPERTY,
EQUIPMENT, ETC.
(4) CONTRACTOR'S RECOGNITION OF THE PROBLEMS INHERENT IN THE NATURE
AND LOCATION OF THE PROPOSED WORK AND SERVICES, TO INCLUDE
IDENTIFICATION OF CRITICAL PROBLEM AREAS AND PROPOSED SOLUTIONS.
"C. CONTRACTOR'S PAST EXPERIENCE ON MAINTENANCE AND REPAIR OF
SIMILAR CONSTRUCTION EQUIPMENT.
"D. OFFEROR'S LABOR RATES, PER DIEM RATES AND ESTIMATED
TRANSPORTATION COSTS.
"D 4. THE GOVERNMENT, AFTER EVALUATION OF ALL FACTORS OUTLINED
ABOVE, INTENDS TO AWARD A CONTRACT TO THE CONTRACTOR WHOSE OFFER IS THE
MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS
CONSIDERED."
IN ADDITION, SECTION D REQUIRED SUBMISSION OF, AMONG OTHER THINGS, A
PRICING PROPOSAL IN TWO PARTS SHOWING (1) STRAIGHT TIME AND OVERTIME
HOURLY RATES FOR EACH LABOR CLASSIFICATION SPECIFIED AND (2) A BREAKDOWN
OF THE TOTAL ESTIMATED COST FOR THE ENTIRE PROJECT, TO INCLUDE LABOR,
TRAVEL, PER DIEM AND OTHER DIRECT AND INDIRECT COSTS; A PROGRAM
MANAGEMENT PLAN SHOWING THE APPROACH OR METHOD OF ACCOMPLISHING THE
WORK; PROPOSED MAN-LOADING BY NUMBER AND LABOR CLASSIFICATION FOR EACH
SERVICE LOCATION SPECIFIED BASED ON THE LIST OF EQUIPMENT AT EACH SITE;
THE PROPOSED TOTAL MAN-LOADING BY NUMBER AND CLASSIFICATION FOR THE
ENTIRE PROJECT; AND PERSONNEL RESUMES FOR EMPLOYEES IN EIGHT
CLASSIFICATIONS. THE RFQ SPECIFIED 26 SITES WHERE PERFORMANCE WOULD BE
REQUIRED, AND CONTAINED A LIST OF THE NUMBER, TYPE AND LOCATION OF THE
EQUIPMENT. AMENDMENT 1 TO THE RFQ INCLUDED THE FOLLOWING PROVISION
CONCERNING EVALUATION OF COST:
"THE COST CRITERIA TO BE USED IN EVALUATION WILL BE THE TOTAL
ESTIMATED COST TO THE GOVERNMENT, WHICH WILL BE COMPUTED BY APPLYING THE
CONTRACTOR'S PROPOSED PER DIEM RATES AND LABOR BILLING RATES TO
CONTRACTOR'S PROPOSED STAFFING. CONTRACTOR'S PROPOSED OTHER FORESEEABLE
COST WILL ALSO BE A CRITERIA WHICH WILL BE USED TO ARRIVE AT A TOTAL
ESTIMATED COST FOR THE SERVICES."
AFTER RECEIPT OF THE QUOTATIONS, A CONTRACTING OFFICER'S TEAM
PERFORMED A TECHNICAL EVALUATION DURING THE PERIOD SEPTEMBER 21 THROUGH
OCTOBER 8, 1970, IN ACCORDANCE WITH THE EVALUATION PLAN DEVELOPED PRIOR
THERETO. THE TECHNICAL EVALUATION WAS BASED ON THE FACTORS LISTED IN
SECTION D 2 A, B AND C, AND APPLICATION THERETO OF WEIGHTS OF 40, 30 AND
20 PERCENT, RESPECTIVELY, AS ESTABLISHED IN THE EVALUATION PLAN. THE
FOLLOWING RANKING RESULTED FROM THE INITIAL EVALUATION:
RANKING FIRM POINTS
1 DYNALECTRON 368.96
2 6 360.96
3 7 340.52
4 3 333.60
5 2 287.44
6 9 225.68
7 1 204.68
8 SPACE AGE 191.58
9 4 168.30
10 11 160.92
11 12 137.18
12 10 92.68
THE EVALUATION TEAM CONCLUDED THAT THE FIRST FOUR FIRMS WERE IN THE
ZONE OF CONSIDERATION. HOWEVER, AS REQUIRED BY THE EVALUATION PLAN, THE
REPORT INCLUDED INFORMATION AS TO THE WEAKNESSES IN EACH QUOTATION.
DURING THE PERIOD OCTOBER 19 THROUGH NOVEMBER 9, 1970, THE CONTRACTING
OFFICER CONDUCTED NEGOTIATIONS WITH ALL 12 FIRMS AND THEY WERE ADVISED
OF THEIR RESPECTIVE AREAS OF WEAKNESS AND AFFORDED AN OPPORTUNITY TO
MAKE REVISIONS. AFTER REVISIONS WERE MADE, THE QUOTATIONS WERE
REEVALUATED. THE RANKING REMAINED THE SAME THROUGH FIRM NUMBER NINE.
YOUR POINT TOTAL INCREASED TO 193.38 AND DYNALECTRON'S POINT TOTAL
INCREASED TO 375.46. THE EVALUATED ESTIMATED COST OF YOUR QUOTATION WAS
$1,458,625.40, AND DYNALECTRON'S WAS $1,531,703.20, A DIFFERENCE OF
$73,077.80. THESE FIGURES DO NOT INCLUDE YOUR PHASE-IN COST ESTIMATE OF
$24,820. DYNALECTRON'S ESTIMATED COST WAS THE LOWEST OF THE SIX HIGHEST
TECHNICALLY RANKED QUOTATIONS. SUBSEQUENT TO THE FINAL TECHNICAL
EVALUATION, A 10 PERCENT WEIGHT FACTOR WAS APPLIED TO COST. THE LOW
QUOTATION WAS ASSIGNED THE MAXIMUM OF 10 PERCENT AND A PERCENTAGE RATIO
BETWEEN THAT QUOTATION AND THE OTHERS WAS ESTABLISHED. THE RESPECTIVE
SCORES FOR COST WERE ADDED TO THE TECHNICAL POINT SCORES WITH NO
RESULTING CHANGE IN THE RANKINGS.
THE SUBJECT PROCUREMENT WAS NEGOTIATED PURSUANT TO 10 U.S.C.
2304(A)(10), AS IMPLEMENTED BY PARAGRAPH 3-210.2(VIII) OF THE ARMED
SERVICES PROCUREMENT REGULATION (ASPR). SECTION 2302, TITLE 10 U.S.C.,
DEFINES THE TERM "NEGOTIATE" AS MEANING TO "MAKE WITHOUT FORMAL
ADVERTISING." IN A NEGOTIATED PROCUREMENT, THE RULES OF FORMALLY
ADVERTISED, COMPETITIVE BIDDING, SUCH AS THE REQUIREMENT FOR AWARD TO
THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER, ARE NOT CONTROLLING AND A
CONTRACTING OFFICER MAY PROPERLY TAKE INTO CONSIDERATION ALL FACTORS
DEEMED ESSENTIAL TO THE PROCUREMENT GOAL. TH GOAL OF THIS PROCUREMENT
WAS TO PROCURE AN INDEFINITE AND INDETERMINABLE AMOUNT OF SPECIFIED
SERVICES FROM A RESPONSIBLE SOURCE AT FAIR AND REASONABLE PRICES
CALCULATED TO RESULT IN THE LOWEST ULTIMATE OVERALL COST TO THE
GOVERNMENT. SEE ASPR 3-801.1. IN THIS CONNECTION, ASPR 3-806(A) STATES
THAT "THE OBJECTIVE OF THE CONTRACTING OFFICER SHALL NEGOTIATE FAIR AND
REASONABLE PRICES IN WHICH DUE WEIGHT IS GIVEN TO ALL RELEVANT FACTORS,
INCLUDING THOSE IN 3-101." ASPR 3-101 STATES THAT WHEN NEGOTIATIONS ARE
ENTERED INTO DUE ATTENTION SHALL BE GIVEN TO NUMBER OF FACTORS,
INCLUDING "CONSIDERATION OF THE SOUNDNESS OF PROSPECTIVE CONTRACTORS'
MANAGEMENT OF LABOR RESOURCES, INCLUDING WAGE RATES, NUMBER OF WORKERS
AND TOTAL ESTIMATED LABOR HOURS."
IT IS OUR OPINION THAT UNDER THE FOREGOING PRINCIPLES, AND IN VIEW OF
THE NATURE OF THE SERVICES BEING PROCURED AND THE TYPE OF CONTRACT
CONTEMPLATED, THE CONTRACTING OFFICER PROPERLY CONCLUDED THAT AWARD TO
THE RESPONSIBLE FIRM QUOTING THE LOWEST ESTIMATED COST WAS NOT
NECESSARILY THE MOST ADVANTAGEOUS. MOREOVER, THE RFQ INCLUDED
REQUIREMENTS FOR SUBMISSION OF RELEVANT FACTORS IN ADDITION TO COST, AND
INDICATED THAT THESE OTHER FACTORS WERE OF GREATER IMPORTANCE IN
SELECTION OF THE CONTRACTOR. FURTHER, IT IS OUR VIEW THAT THE
EVALUATION PLAN AND EVALUATION THEREUNDER GAVE DUE WEIGHT TO THE
RELEVANT FACTORS ESSENTIAL TO SELECTING A FIRM WHOSE PERFORMANCE WAS
CALCULATED TO RESULT IN THE LOWEST OVERALL COST TO THE GOVERNMENT.
CONCERNING YOUR CONTENTION THAT THE WEIGHTS OF THE VARIOUS FACTORS
WERE NOT DISCLOSED, WE HAVE HELD THAT OFFERORS SHOULD BE INFORMED OF THE
RELATIVE WEIGHT OR IMPORTANCE ATTACHED TO EACH FACTOR.
49 COMP. GEN. 229 (1969). THE RFQ WAS DEFICIENT IN THIS RESPECT.
HOWEVER, IN VIEW OF THE RELATIVELY LOW TECHNICAL SCORE RECEIVED BY YOUR
FIRM AND THE RELATIVELY SMALL DIFFERENCE BETWEEN YOUR'S AND
DYNALECTRON'S ESTIMATED COSTS, WE DO NOT BELIEVE YOU WERE PREJUDICED BY
THIS DEFICIENCY.
SEE B-169764, DECEMBER 23, 1970; B-170449, NOVEMBER 17, 1970.
ALTHOUGH YOU DISAGREE WITH CERTAIN CONCLUSIONS OF THE EVALUATION TEAM
WITH RESPECT TO YOUR PERSONNEL, THERE IS NO BASIS FOR OUR OFFICE TO
SUBSTITUTE OUR JUDGMENT FOR THAT OF QUALIFIED EVALUATORS IN THE ABSENCE
OF BASIS. ON THE BASIS OF THE RECORD BEFORE US, WE ARE UNABLE TO MAKE
SUCH FINDINGS. FURTHERMORE, THE FACT THAT DYNALECTRON PROPOSES TO
EMPLOY SOME LOCAL NATIONALS DOES NOT AFFORD OUR OFFICE A BASIS FOR
QUESTIONING THE EVALUATION TEAM'S CONCLUSIONS WITH RESPECT TO ITS
OVERALL CAPABILITY.
B-172375, MAY 17, 1971
RETIREMENT - OPTIONAL OR FOR DISABILITY
DECISION ALLOWING CLAIM BY JAMES P. SETLIFF FOR 1419 HOURS OF SICK
LEAVE STANDING TO HIS CREDIT AT THE TIME OF HIS SEPARATION FROM THE
TREASURY DEPARTMENT, INTERNAL REVENUE SERVICE, NASHVILLE, TENNESSEE.
BECAUSE CLAIMANT'S RETIREMENT WAS PROCESSED BY THE CIVIL SERVICE
COMMISSION AS ONE FOR DISABILITY, IT WAS ERROR FOR IRS TO SEPARATE
CLAIMANT ON THE BASIS OF HIS OPTIONAL RETIREMENT APPLICATION. THE
ACTION OF THE CIVIL SERVICE COMMISSION WAS MADE WITH FULL KNOWLEDGE OF
BOTH RETIREMENT APPLICATIONS, DISABILITY AND OPTIONAL, AND ITS ACTIONS
ON QUESTIONS OF DISABILITY ARE BY STATUTE FINAL AND CONCLUSIVE.
THEREFORE, CLAIMANT SHOULD BE RESTORED TO THE ROLLS FOR COMPENSATING HIM
FOR THE SICK LEAVE IN QUESTION.
TO MR. SECRETARY:
TRANSMITTED HEREWITH FOR ADMINISTRATIVE DISPOSITION IS THE CLAIM OF
MR. JAMES P. SETLIFF FOR 1419 HOURS OF SICK LEAVE STANDING TO HIS CREDIT
AT THE TIME OF HIS SEPARATION FROM THE SERVICE ON FEBRUARY 28, 1969, AS
AN EMPLOYEE OF THE TREASURY DEPARTMENT, INTERNAL REVENUE SERVICE,
NASHVILLE, TENNESSEE.
THE RECORD SHOWS THAT MR. SETLIFF APPLIED FOR DISABILITY RETIREMENT
ON JANUARY 13, 1969, AND WAS NOTIFIED BY THE CIVIL SERVICE COMMISSION ON
FEBRUARY 24, 1969, THAT HIS APPLICATION FOR ANNUITY ON ACCOUNT OF
DISABILITY HAD BEEN APPROVED. IN THE MEANTIME, ON FEBRUARY 14, 1969, HE
HAD FILED AN APPLICATION FOR OPTIONAL RETIREMENT TO BECOME EFFECTIVE
FEBRUARY 28, 1969. IT WAS MR. SETLIFF'S INTENTION THAT THIS LATTER
APPLICATION WAS TO BE EFFECTIVE ONLY IN THE EVENT HIS DISABILITY
RETIREMENT APPLICATION WAS NOT APPROVED. AS INDICATED IN THE ENCLOSED
COPY OF LETTER DATED JULY 22, 1970, FROM THE DIRECTOR, PERSONNEL
DIVISION, INTERNAL REVENUE SERVICE, TO THE CLAIMS DIVISION OF OUR
OFFICE, MR. SETLIFF WAS REMOVED FROM THE ROLLS ON FEBRUARY 28, 1969, ON
THE BASIS OF HIS OPTIONAL RETIREMENT APPLICATION, NOTWITHSTANDING HIS
RETIREMENT WAS IN FACT PROCESSED BY THE CIVIL SERVICE COMMISSION AS A
DISABILITY RETIREMENT. THE ACTION OF THE COMMISSION IN PROCESSING THE
RETIREMENT AS ONE FOR DISABILITY WAS MADE WITH FULL KNOWLEDGE OF THE
APPLICATION FOR OPTIONAL RETIREMENT, AND ITS ACTIONS ON QUESTIONS OF
DISABILITY ARE BY STATUTE FINAL AND CONCLUSIVE. 5 U.S.C. 8347(C). IT
THEREFORE APPEARS THAT THE ACTION TAKEN BY THE INTERNAL REVENUE SERVICE
SEPARATING MR. SETLIFF ON THE BASIS OF HIS OPTIONAL RETIREMENT
APPLICATION WAS ERRONEOUS.
IN LETTER DATED MAY 20, 1970, COPY HEREWITH, FROM THE UNITED STATES
CIVIL SERVICE COMMISSION, BUREAU OF RETIREMENT, INSURANCE, AND
OCCUPATIONAL HEALTH, TO MR. GARETH S. ADEN, ATTORNEY FOR MR. SETLIFF,
IT WAS STATED:
"ONCE A PROPER SEPARATION IS EFFECTED IT CANNOT BE RESCINDED OR
CHANGED BY ADMINISTRATIVE ACTION EXCEPT TO CORRECT AN OBVIOUS ERROR.
THE QUESTION OF WHETHER THE RETIREMENT DATE OF FEBRUARY 28, 1969 COULD
BE CHANGED TO PERMIT THE GRANTING OF SICK LEAVE IS A MATTER FOR THE
INTERNAL REVENUE SERVICE TO DECIDE AND WHETHER SUCH CHANGE COULD BE MADE
IS SUBJECT TO RULINGS OF THE COMPTROLLER GENERAL.
"IF THE INTERNAL REVENUE SERVICE FINDS A BASIS FOR CHANGING MR.
SETLIFF'S SEPARATION DATE FROM FEBRUARY 28, 1969 TO SUCH DATE AS HIS
SICK LEAVE WOULD EXPIRE AND SUBMITS A CORRECTED RECORD WE WOULD ADJUST
HIS ANNUITY ACCORDINGLY."
THE LONG ESTABLISHED RULE OF OUR OFFICE IS THAT WHEN AN AUTHORIZED
SEPARATION, BY RESIGNATION OR OTHERWISE, BECOMES AN ACCOMPLISHED FACT IT
MAY NOT BE RESCINDED OR SET ASIDE BY ADMINISTRATIVE ACTION. 32 COMP.
GEN. 111 (1952). HOWEVER, WE HAVE PERMITTED EXCEPTIONS TO THAT RULE
WHEN THE SEPARATION DID NOT CONFORM TO THE INTENT OF THE PARTIES
CONCERNED OR WAS NOT IN CONFORMANCE WITH APPLICABLE REGULATIONS. SEE 39
COMP. GEN. 89 (1959).
IT APPEARS FROM THE INTERNAL REVENUE SERVICE LETTER DATED JULY 22,
1970, THAT HAD MR. SETLIFF'S RETIREMENT BEEN VIEWED AS FOR DISABILITY,
HE WOULD HAVE BEEN GIVEN, UPON HIS REQUEST, THE OPPORTUNITY TO EXHAUST
HIS SICK LEAVE BEFORE FINAL SEPARATION.
WE BELIEVE THAT UNDER THE FACTS AND CIRCUMSTANCES OUTLINED ABOVE MR.
SETLIFF SHOULD BE RESTORED TO THE ROLLS FOR THE PURPOSE OF COMPENSATING
HIM FOR THE SICK LEAVE IN QUESTION WITH ADVICE OF SUCH ACTION TO THE
CIVIL SERVICE COMMISSION IN ORDER THAT APPROPRIATE ADJUSTMENTS MAY BE
MADE IN THE RETIREMENT ACCOUNT.
THE ENCLOSURES FORWARDED HEREWITH TO SUPPORT THE CLAIM INDICATE THE
NATURE OF THE ADJUSTMENTS REQUIRED.
CONGRESSMAN RICHARD FULTON HAS EXPRESSED AN INTEREST IN THIS CLAIM
AND IS BEING FURNISHED A COPY OF THIS LETTER.
B-172526, MAY 17, 1971
BID PROTEST - RESOLICITATION - DAVIS BACON ACT SUSPENSION
DENIAL OF PROTEST OF BUILDING MAINTENANCE CORP., AGAINST THE AWARD OF
A GSA CONSTRUCTION CONTRACT TO ANY OTHER FIRM.
PROTESTANT, WHOSE LOW BID WAS REJECTED WHEN THE DAVIS-BACON ACT WAS
SUSPENDED BY PRESIDENTIAL PROCLMATION, CONTENDS THAT WITH REINSTATEMENT
OF THE WAGE PROVISIONS OF THAT ACT BY SUBSEQUENT PROCLAMATION AWARD
SHOULD BE MADE UNDER THE FIRST SOLICITATION. AS SUSPENSION WAS
AUTHORIZED BY STATUTE AND AS THE PROCLAMATION REINSTATING THE WAGE RATES
WAS PROSPECTIVE, AWARD UNDER THE SECOND SOLICITATION IS PROPER.
TO BUILDING MAINTENANCE CORP.:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 31, 1971, PRESENTING A
QUESTION REGARDING THE SUSPENSION AND SUBSEQUENT REINSTATEMENT OF THE
DAVIS-BACON ACT. YOU STATE THAT YOU WERE THE LOW BIDDER FOR A GENERAL
SERVICES ADMINISTRATION (GSA) CONSTRUCTION PROJECT WHEN THE PRESIDENT
SUSPENDED THE ACT; THAT ALL BIDS WERE THEREFORE REJECTED AND NEW BIDS,
TO BE OPENED ON APRIL 22, WERE SOLICITED WITHOUT THE DAVIS-BACON ACT
WAGE RATES. YOU CONTEND THAT, IN VIEW OF THE REINSTATEMENT OF THE
DAVIS-BACON ACT ON MARCH 29, BY PRESIDENTIAL PROCLAMATION 4040, YOU
SHOULD NOW BE CONSIDERED IN THE SAME POSITION THAT YOU WERE IN PRIOR TO
THE ACT'S SUSPENSION. HOWEVER, SINCE GSA HAS INTERPRETED THE NEW
PROCLAMATION NOT TO INCLUDE THE PROJECT IN QUESTION, SINCE IT WAS "ON
THE STREET" PRIOR TO REINSTATEMENT OF THE DAVIS-BACON ACT, YOU ASK TO BE
ADVISED WHETHER THIS OFFICE IS IN AGREEMENT WITH GSA'S POSITION.
PROCLAMATION 4040 DATED MARCH 29, 1971, BY ITS TERMS REVOKED
PROCLAMATION 4031 AND EFFECTIVELY REINSTATED THE DAVIS-BACON ACT, BUT
ONLY AS TO ALL CONSTRUCTION CONTRACTS FOR WHICH SOLICITATIONS FOR BIDS
OR PROPOSALS ARE ISSUED AFTER MARCH 29, 1971. COPIES OF BOTH
PROCLAMATIONS ARE ENCLOSED. THE LATTER, BY NECESSARY IMPLICATION,
PROVIDED THAT CONTRACTS MAY BE AWARDED UNDER SOLICITATIONS ISSUED AFTER
FEBRUARY 23, 1971, BUT BEFORE MARCH 30, 1971, WHICH DO NOT CONTAIN THE
DAVIS-BACON ACT PROVISIONS. TO THE SAME EFFECT, SEE PARAGRAPH 2 OF A
MEMORANDUM DATED MARCH 30, 1971, COPY ALSO ENCLOSED, FROM THE GSA, WHICH
IMPLEMENTS PROCLAMATION 4040 AND SETS OUT PROCEDURES TO BE FOLLOWED WITH
RESPECT TO INVITATIONS WHICH HAD BEEN ISSUED DURING THE SUSPENSION OF
THE DAVIS-BACON ACT.
SINCE THE REVOCATION AND REINSTATEMENT ACTIONS WERE AUTHORIZED BY
STATUTE, AND THE IMPLEMENTING MEMORANDUM OF MARCH 30, 1971, APPEARS TO
HAVE BEEN NECESSARY AND PROPER IN THE CIRCUMSTANCES, WE ARE UNABLE TO
CONCLUDE THAT AN AWARD TO THE LOWEST RESPONSIBLE, RESPONSIVE BIDDER ON
THE BIDS TO BE OPENED ON APRIL 22 WOULD BE IMPROPER.
B-172564, MAY 17, 1971
MILITARY PERSONNEL - BASIC QUARTERS ALLOWANCE - MILITARY POLICE TROOPS
REQUEST FOR DECISION CONCERNING THE PAYMENT OF SPECIALIST 4 THOMAS P.
GLASS BASIC ALLOWANCE FOR QUARTERS FOR THE PERIOD MARCH 9, 1970, THROUGH
JANUARY 31, 1971. ALTHOUGH NO CONTEMPORANEOUS CERTIFICATION WAS GIVEN,
OTHER THAN VERBAL AUTHORIZATION BY HIS COMMANDING OFFICER, UNDER THE
CIRCUMSTANCES OF ARMY POLICY REQUIRING CRIMINAL INVESTIGATORS TO BE
HOUSED SEPARATELY FROM OTHER MILITARY POLICE PERSONNEL, THE VOUCHER IS
APPROVED FOR PAYMENT.
TO LIEUTENANT COLONEL G. C. COURTNEY, FC:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 22, 1971,
REFERENCE RICO-FO, FORWARDED TO THIS OFFICE BY THE OFFICE OF THE
COMPTROLLER OF THE ARMY UNDER DATE OF APRIL 6, 1971, REQUESTING AN
ADVANCE DECISION AS TO WHETHER SP4 THOMAS P. GLASS, 000-00-4709, MAY BE
PAID BASIC ALLOWANCE FOR QUARTERS (BAQ) FOR THE PERIOD MARCH 9, 1970,
THROUGH JANUARY 31, 1971, WHILE HE WAS ASSIGNED TO THE 123RD MILITARY
POLICE DETACHMENT, UNITED STATES ARMY, RYUKYU ISLANDS. THE REQUEST HAS
BEEN ASSIGNED CONTROL NUMBER DO-A-1118 BY THE DEPARTMENT OF DEFENSE
MILITARY PAY AND ALLOWANCE COMMITTEE.
IT APPEARS THAT SPECIALIST GLASS OCCUPIED GOVERNMENT QUARTERS UNTIL
MARCH 9, 1970. ON THAT DATE HE APPARENTLY MOVED OUT OF THOSE QUARTERS
INTO PRIVATE FACILITIES "OFF-POST" PURSUANT TO VERBAL AUTHORITY GIVEN BY
THE THEN COMMANDING OFFICER OF THE 123RD MILITARY POLICE DETACHMENT (CI)
AND APPROVED VERBALLY BY THE THEN COMMANDING OFFICER OF THE 1ST MILITARY
POLICE GROUP. THE RECORD DOES NOT SHOW WHETHER THE INSTALLATION
COMMANDING OFFICER ALSO APPROVED OF SUCH ACTION AT THAT TIME. THE
REASON GIVEN FOR SPECIALIST GLASS'S CHANGE OF QUARTERS IS THAT, AS A
CRIMINAL INVESTIGATOR, ARMY REGULATIONS REQUIRED THAT HE NOT BE
QUARTERED WITH OTHER THAN MILITARY POLICE TROOPS (AR 195-10, PARAGRAPH
3-14) AND NO SUCH SUITABLE GOVERNMENT QUARTERS WERE AVAILABLE.
APPARENTLY, HOWEVER, NO CERTIFICATION OF NONAVAILABILITY OF SUITABLE
QUARTERS WAS MADE BY THE INSTALLATION COMMANDER OR HIS DESIGNEE
CONTEMPORANEOUS WITH SPECIALIST GLASS'S MOVE TO NON-GOVERNMENT QUARTERS.
THE RECORD INDICATES THAT SPECIALIST GLASS FIRST SUBMITTED A REQUEST
FOR QUARTERS ALLOWANCE ON OCTOBER 28, 1970, WHICH WAS ENDORSED
"RECOMMEND APPROVAL" BY THE NEW COMMANDING OFFICER OF THE 123RD MILITARY
POLICE DETACHMENT, BUT THE CLAIM APPEARS TO HAVE BEEN RETURNED TO
SPECIALIST GLASS FROM THE BASE FINANCE AND ACCOUNTING OFFICE FOR LACK OF
A CERTIFICATE OF NONAVAILABILITY OF ADEQUATE QUARTERS. THE REQUEST FOR
QUARTERS ALLOWANCE APPARENTLY WAS RESUBMITTED. THE RECORD SHOWS THAT
SUBSEQUENTLY A REQUEST FOR EXCEPTION TO POLICY WAS APPROVED ON JANUARY
25, 1971, BY HEADQUARTERS, U.S. ARMY, RYUKYU ISLANDS, AND AS A RESULT OF
WHICH A CERTIFICATE OF NONAVAILABILITY OF QUARTERS WAS ISSUED ON
FEBRUARY 10, 1971, STATING UNEQUIVOCALLY THAT "QUARTERS HAVE NOT BEEN
AVAILABLE TO SP/4 GLASS FROM 9 MARCH 1970." THAT CERTIFICATE WAS SIGNED
BY THE BACHELOR HOUSING OFFICER UNDER AUTHORITY DELEGATED BY THE
INSTALLATION COMMANDING OFFICER.
THE RECORD ALSO CONTAINS A COPY OF SPECIAL ORDERS NUMBER 48,
HEADQUARTERS U.S. ARMY, RYUKYU ISLANDS, DATED FEBRUARY 17, 1971, WHICH
AUTHORIZED A BASIC ALLOWANCE FOR QUARTERS IN THE AMOUNT OF $60 (PER
MONTH) FOR SPECIALIST GLASS EFFECTIVE MARCH 9, 1970. SUCH ACTION IS
STATED TO BE IN CONFIRMATION OF VERBAL ORDERS OF THE COMMANDING OFFICER
DATED MARCH 9, 1970.
SUBMITTED WITH YOUR LETTER WAS A MILITARY PAY VOUCHER IN FAVOR OF
SPECIALIST GLASS IN THE AMOUNT OF $646 COVERING THE QUARTERS ALLOWANCE
FROM MARCH 9, 1970, TO JANUARY 31, 1971. YOU INDICATE THAT YOU ARE
UNCERTAIN AS TO WHETHER PAYMENT SHOULD BE MADE ON THAT VOUCHER SINCE THE
RECORD DOES NOT CLEARLY SHOW THAT A VERBAL ORDER WAS ISSUED BY COMPETENT
AUTHORITY ON MARCH 9, 1970, AUTHORIZING SPECIALIST GLASS TO MOVE OUT OF
GOVERNMENT QUARTERS.
SECTION 403 OF TITLE 37, U.S. CODE (WHICH WAS DERIVED FROM SECTION
302 OF THE CAREER COMPENSATION ACT OF 1949, CH. 681, 63 STAT. 812),
PROVIDES IN PERTINENT PART:
"(A) EXCEPT AS OTHERWISE PROVIDED BY THIS SECTION OR BY ANOTHER LAW,
A MEMBER OF A UNIFORMED SERVICE WHO IS ENTITLED TO BASIC PAY IS ENTITLED
TO A BASIC ALLOWANCE FOR QUARTERS ***
"(B) EXCEPT AS OTHERWISE PROVIDED BY LAW, A MEMBER OF A UNIFORMED
SERVICE WHO IS ASSIGNED TO QUARTERS OF THE UNITED STATES OR A HOUSING
FACILITY UNDER THE JURISDICTION OF A UNIFORMED SERVICE, APPROPRIATE TO
HIS GRADE, RANK OR RATING AND ADEQUATE FOR HIMSELF, AND HIS DEPENDENTS,
IF WITH DEPENDENTS, IS NOT ENTITLED TO A BASIC ALLOWANCE FOR QUARTERS.
*** " IMPLEMENTING REGULATIONS CONTAINED IN PARAGRAPH 30212 OF THE
DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCES ENTITLEMENTS MANUAL
AUTHORIZE THE BASE OR INSTALLATION COMMANDER TO ASSIGN AND TERMINATE
QUARTERS AND DETERMINE WHEN QUARTERS ARE "ADEQUATE" AND "SUITABLE."
IN OUR DECISION B-141316, FEBRUARY 8, 1960, 39 COMP. GEN. 561, WE
HELD THAT UNDER THE PROVISIONS OF THE CAREER COMPENSATION ACT OF 1949,
CLAIMS FOR PAYMENT OF A QUARTERS ALLOWANCE ARE FOR DETERMINATION ON THE
BASIS OF THE FACTS APPEARING IN THE CASE RATHER THAN ON A SPECIFIC
ADMINISTRATIVE AUTHORIZATION OR CERTIFICATION AND THAT, WHILE A
CONTEMPORANEOUS AUTHORIZATION OR CERTIFICATION BY PROPER AUTHORITY
USUALLY IS CONSIDERED TO BE THE BEST EVIDENCE OF THE FACTS, IT IS NOT
CONCLUSIVE OF THE MATTER WHERE THE FACTS ARE OTHERWISE CLEARLY
ESTABLISHED.
THE QUESTION HERE INVOLVED IS NOT ONE OF RETROACTIVE AUTHORIZATION
FOR PAYMENT OF BASIC ALLOWANCE FOR QUARTERS OR OF AVAILABILITY OF
GOVERNMENT QUARTERS; IT IS A MATTER OF ASSIGNMENT OF QUARTERS. THE
RECORD DOES NOT SHOW WHETHER OR NOT SPECIALIST GLASS WAS FORMALLY
ASSIGNED THE QUARTERS HE VACATED ON MARCH 9, 1970. WHILE HIS COMMANDING
OFFICER HAD NO AUTHORITY TO TERMINATE A FORMAL ASSIGNMENT OF QUARTERS
(IF SUCH ASSIGNMENT WERE IN FACT ISSUED), IN VIEW OF THE ARMY POLICY OF
NOT QUARTERING CRIMINAL INVESTIGATORS WITH OTHER THAN MILITARY POLICE
TROOPS, IT APPEARS THAT SUCH COMMANDING OFFICER'S ACTION IN VERBALLY
AUTHORIZING SPECIALIST GLASS TO VACATE HIS QUARTERS ON MARCH 9, 1970,
WAS PROPER. SUCH QUARTERS APPARENTLY WERE NOT OCCUPIED BY MILITARY
POLICE.
IN THE CIRCUMSTANCES, AND SINCE THE INSTALLATION COMMANDER - WHO HAD
FULL AUTHORITY TO ASSIGN AND TERMINATE ASSIGNMENT OF QUARTERS AND
DETERMINE ADEQUACY OF QUARTERS - DELEGATED TO THE BACHELOR HOUSING
OFFICER AUTHORITY TO DETERMINE AVAILABILITY OF GOVERNMENT QUARTERS AND
THE LATTER OFFICIAL ISSUED A CERTIFICATION OF NON-AVAILABILITY OF
QUARTERS IN THIS CASE, THERE APPEARS TO BE NO BASIS FOR A CONCLUSION
THAT SPECIALIST GLASS WAS ASSIGNED GOVERNMENT QUARTERS DURING THE PERIOD
OF HIS CLAIM. SINCE GOVERNMENT QUARTERS WERE NOT ASSIGNED AND HE
OCCUPIED PRIVATE QUARTERS AT HIS OWN EXPENSE HE IS ENTITLED TO THE BASIC
ALLOWANCE FOR QUARTERS PROVIDED BY LAW IN SUCH CIRCUMSTANCES.
ACCORDINGLY, THE VOUCHER WHICH IS RETURNED HEREWITH, MAY BE PAID, IF
OTHERWISE CORRECT.
B-172649, MAY 17, 1971
BID PROTEST - DAVIS BACON ACT REINSTATED
DECISION DENYING PROTEST AGAINST AWARD OF A CONTRACT TO ANY OTHER
FIRM UNDER AN IFB ISSUED BY NAVAL FACILITIES ENGINEERING COMMAND.
IN VIEW OF DEPARTMENT OF LABOR'S MEMORANDUM #93 AND #94 THE COMP.
GEN. IS UNABLE TO CONCLUDE THAT THE PRESIDENTIAL PROCLAMATION
REINSTATING THE PROVISIONS OF THE DAVIS-BACON ACT ELIMINATED THE
"COMPELLING REASON" ON WHICH THE ORIGINAL IFB WAS CANCELLED. BECAUSE
THE REQUIREMENTS WERE RESOLICITED DURING THE EFFECTIVE PERIOD OF THE
SUSPENSION OF THE ACT THERE IS NO BASIS FOR CONCLUDING THAT IT IS
MANDATORY ON THE CONTRACTING AGENCY TO REINSTATE THE ORIGINAL BIDS.
TO MORGAN, LEWIS AND BOCKIUS:
FURTHER REFERENCE IS MADE TO YOUR LETTERS OF APRIL 20, 27 AND 29,
1971, PROTESTING IN BEHALF OF FUSCO AMATRUDA COMPANY (FUSCO), THE
FAILURE OF THE NAVAL FACILITIES ENGINEERING COMMAND TO AWARD THAT
COMPANY A CONTRACT UNDER IFB NO. N62472-71-C-0104.
FUSCO SUBMITTED THE LOWEST BID UNDER THE IFB. HOWEVER, THE IFB WAS
CANCELLED ON MARCH 17, 1971, BY THE PROCURING ACTIVITY AND WAS REISSUED
ON MARCH 19, 1971, WITH A NEW BID OPENING DATE OF MAY 18, 1971, AS
N62472-71-C-0104-REVISED, WITHOUT THE PROVISIONS OF THE DAVIS-BACON ACT,
40 U.S.C. 276A.
AUTHORITY FOR THE PROCUREMENT AGENCY'S ACTION IN CANCELLING AND
READVERTISING THE PROCUREMENT WITHOUT THE PROVISIONS OF THE DAVIS-BACON
ACT STEMS FROM THE ACT ITSELF, SECTION 6 OF WHICH PROVIDES:
"IN THE EVENT OF A NATIONAL EMERGENCY THE PRESIDENT IS AUTHORIZED TO
SUSPEND THE PROVISIONS OF THIS ACT." SUSPENSION ACTION WAS TAKEN
THEREUNDER BY PRESIDENTIAL PROCLAMATION 4031, DATED FEBRUARY 23, 1971,
AND CANCELLATION OF THE IFB FOLLOWED.
YOU CONCEDE THAT PRESIDENTIAL PROCLAMATION 4031 CONSTITUTED A
"COMPELLING REASON," WITHIN THE MEANING OF THAT TERM AS USED IN ASPR
2-404.1(A), FOR CANCELLING IFB-0104, REJECTING ALL BIDS RECEIVED
THEREUNDER, AND READVERTISING UNDER IFB-0104-REVISED FOR BIDS WHICH WERE
NOT SUBJECT TO THE DAVIS-BACON ACT. HOWEVER, YOU CONTEND THAT WHEN THE
PRESIDENT ISSUED PROCLAMATION 4040 ON MARCH 29, AND THEREBY REACTIVATED
THE DAVIS-BACON ACT, SUCH ACTION ELIMINATED THE COMPELLING REASON ON
WHICH CANCELLATION OF IFB-0104 WAS BASED. IT FOLLOWS, YOU CONTEND, THAT
SINCE A COMPELLING REASON FOR REJECTING THE BIDS UNDER IFB-0104 NO
LONGER EXISTS, SUCH BIDS MUST NOW BE REINSTATED AND AN AWARD SHOULD BE
MADE THEREUNDER. IN THIS CONNECTION, YOU ARGUE AS FOLLOWS:
"ASPR 2-404.1(A) PLAINLY STATES THAT ITS PURPOSE IS TO PRESERVE THE
INTEGRITY OF THE COMPETITIVE BID SYSTEM, AND THAT, AFTER BIDS ARE
OPENED, IT IS ESSENTIAL TO THE PRESERVATION OF THE INTEGRITY OF THAT
SYSTEM THAT THE AWARD BE MADE TO THE RESPONSIBLE BIDDER WHO SUBMITTED
THE LOWEST RESPONSIVE BID, UNLESS THERE IS A COMPELLING REASON FOR NOT
MAKING SUCH AWARD. IT IS CLEAR, THEREFORE, THAT THE PROCURING AGENCY IS
RELIEVED OF THAT MANDATORY OBLIGATION OF MAKING THE AWARD TO THE LOW,
RESPONSIVE, RESPONSIBLE BIDDER ONLY IF IT IS ACTING UNDER THE COMPULSION
OF A REASON WHICH PREVENTS SUCH AWARD BEING MADE. IN OTHER WORDS, THIS
MANDATORY AWARD MUST BE MADE UNLESS THE COMPELLING REASON, WHICH
PREVENTS SUCH AWARD, CONTINUES UNTIL A VALID AWARD IS MADE UNDER A
RESOLICITATION, OR THE PROCUREMENT IS ABANDONED. THIS IS THE ONLY
INTERPRETATION WHICH CAN BE GIVEN ASPR 2-404.1(A) WHICH ACCORDS IT WITH
ITS PURPOSE. IF AFTER OPENING OF BIDS, AN AWARD IS NOT MADE TO THE LOW,
RESPONSIVE, RESPONSIBLE BIDDER BECAUSE A COMPELLING REASON PREVENTS SUCH
AWARD, AND THAT COMPELLING REASON IS ELIMINATED, THE PROCURING AGENCY
VIOLATES THIS MANDATORY REQUIREMENT IF IT DOES NOT MAKE THE AWARD TO
THAT BIDDER, BECAUSE THERE IS NO LONGER ANY COMPELLING REASON WHICH
PREVENTS THAT AWARD."
"APPLYING THE FOREGOING LAW TO THE PROCUREMENT INVOLVED IN THIS
PROTEST, AN AWARD WOULD HAVE BEEN MADE ON THE BASIS OF PROTESTANT'S BID,
HAD IT NOT BEEN FOR THE ISSUANCE OF PROCLAMATION 4031, WHICH RESULTED IN
THE REJECTION OF THAT BID. ON MARCH 19, 1971, THE PROCUREMENT WAS
RESOLICITED ON SPECIFICATIONS IDENTICAL WITH THOSE ON WHICH PROTESTANT'S
BID WAS SUBMITTED, WITH THE EXCEPTION THAT IN THE LATER INVITATION THE
CONTRACT WAS FREED FROM THE EFFECT OF THE DAVIS-BACON ACT. ON MARCH 29,
THE PRESIDENT, IN PROCLAMATION 4040, REVOKED PROCLAMATION 4031, AND
REINSTATED THE DAVIS-BACON ACT, AND THAT ACTION ELIMINATED THE
COMPELLING REASON WHICH HAD PREVENTED THE AWARD OF THE CONTRACT TO
PROTESTANT ON THE LOW RESPONSIVE BID IT HAD SUBMITTED IN RESPONSE TO THE
INITIAL INVITATION. THUS, UNDER THE FOREGOING LAW, AND UNDER THE
SPECIFIC PROVISIONS OF ASPR 2-404.1(A), WHICH, AS YOU KNOW, HAS THE
FORCE AND EFFECT OF LAW, ON THE ISSUANCE OF PROCLAMATION 4040 IT BECAME
MANDATORY THAT THE PROCURING AGENCY AWARD THE CONTRACT TO PROTESTANT,
BECAUSE THERE WAS NO COMPELLING REASON WHY SUCH AWARD COULD NOT BE
MADE."
PRESIDENTIAL PROCLAMATION 4040 READS, IN PERTINENT PART, AS FOLLOWS:
" *** DO BY THIS PROCLAMATION REVOKE PROCLAMATION NO. 4031 OF
FEBRUARY 23, 1971, AS TO ALL CONSTRUCTION CONTRACTS FOR WHICH
SOLICITATIONS FOR BIDS OR PROPOSALS ARE ISSUED AFTER THE DATE OF THIS
PROCLAMATION *** ."
SINCE THIS PROCLAMATION WAS, BY ITS TERMS, LIMITED TO CONTRACTS FOR
WHICH SOLICITATIONS FOR BIDS OR PROPOSALS WERE ISSUED AFTER MARCH 29 WE
DO NOT BELIEVE THAT THE PROCLAMATION REINSTATED, OR WAS INTENDED TO
REINSTATE, THE DAVIS-BACON ACT WITH RESPECT TO SOLICITATIONS, SUCH AS
IFB-0104, WHICH WERE ISSUED BETWEEN FEBRUARY 23 AND MARCH 29. THIS
CONCLUSION IS SUPPORTED BY THE PROVISIONS OF THE DEPARTMENT OF LABOR'S
MEMORANDUM #93, WHICH READ, IN PERTINENT PART, AS FOLLOWS:
"UNDER PROCLAMATION 4040 OF MARCH 29, 1971, REVOKING THE DAVIS-BACON
SUSPENSION IMPOSED BY PROCLAMATION 4031 OF FEBRUARY 23, 1971, FEDERAL
WAGE PAYMENT REQUIREMENTS DEPENDENT ON WAGE DETERMINATIONS OF THE
SECRETARY OF LABOR ARE ONCE AGAIN MADE APPLICABLE TO -
"SOLICITATIONS (ISSUED AFTER MARCH 29, 1971) FOR BIDS OR PROPOSALS ON
FEDERAL OR FEDERALLY ASSISTED CONSTRUCTION OF A CHARACTER SUBJECT TO THE
PREVIOUS SUSPENSION; AND
"BY ITS TERMS, PROCLAMATION 4040 DOES NOT SPECIFICALLY REQUIRE
CHANGES IN PENDING PROCUREMENT ACTIONS OR CONTRACT PROCEDURES WITH
RESPECT THERETO WHICH WERE INITIATED PRIOR TO THE REVOCATION OF THE
SUSPENSION.
"WHERE BIDS OR PROPOSALS FOR CONTRACT WORK WERE SOLICITED SUBJECT TO
DAVIS-BACON PROVISIONS PRIOR TO PROCLAMATION 4031 SUSPENDING SUCH
PROVISIONS WITH RESPECT TO 'CONTRACTS ENTERED INTO' ON OR AFTER FEBRUARY
23, 1971, AND NO FURTHER ACTION HAS BEEN TAKEN AND NO CONTRACT ENTERED
INTO PURSUANT TO SUCH SOLICITATION BETWEEN FEBRUARY 23 AND MARCH 29,
1971, INCLUSIVE, IT WOULD APPEAR THAT NO CONTRACT OR SOLICITATION
THEREFOR BECAME SUBJECT TO THE SUSPENSION PROCLAMATION BEFORE THE
REVOCATION BY PROCLAMATION 4040 AND THAT THE ADDITIONAL EFFORT AND
EXPENSE OF ISSUING A RESOLICITATION AFTER MARCH 29, 1971 WOULD NOT BE
REQUIRED AS A RESULT SOLELY OF THE TWO PROCLAMATIONS. *** "
THE INTENTION THAT SOLICITATIONS ISSUED BETWEEN FEBRUARY 23 AND MARCH
29 SHOULD CONTINUE TO BE EXEMPT FROM THE DAVIS-BACON ACT IS MADE EVEN
CLEARER BY THE FOLLOWING PROVISIONS OF THE DEPARTMENT'S MEMORANDUM #94:
"IT HAS BEEN BROUGHT TO OUR ATTENTION THAT A NUMBER OF AGENCIES HAVE
PENDING PROCUREMENT ACTIONS FOR CONSTRUCTION PROJECTS ON WHICH BIDS OR
PROPOSALS WERE SOLICITED WITHOUT DAVIS-BACON WAGE PAYMENT PROVISIONS
DURING THE PERIOD FROM FEBRUARY 23 TO MARCH 29, INCLUSIVE, AS A RESULT
OF THE SUSPENSION BY PROCLAMATION 4031, AND TO WHICH THE DAVIS-BACON
ACT, EXCEPT FOR THE EFFECT OF THE SUSPENSION, WOULD BE APPLICABLE.
"FOR THE FURTHER GUIDANCE OF THE AGENCIES OF THE FEDERAL GOVERNMENT
AND THE DISTRICT OF COLUMBIA WITH RESPECT TO THESE PENDING PROCUREMENT
ACTIONS, THE PRESIDENT HAS ASKED ME TO EXPLAIN THAT IN THE CASE OF
CONTRACTS NOT YET ENTERED INTO AS A RESULT OF THE SOLICITATION OF BIDS
OR PROPOSALS DURING THE PERIOD WHEN PROCLAMATION 4031 WAS EFFECTIVE,
EACH AGENCY SHOULD, IF IT CAN DO SO LEGALLY AND WITHOUT UNDUE HARDSHIP,
TAKE SUCH ACTION TO ACCOMPLISH A RESOLICITATION OF BIDS OR PROPOSALS AS
IS AUTHORIZED UNDER THE GOVERNING PROCUREMENT LAWS AND REGULATIONS AND
IS MOST APPROPRIATE TO EFFECT A REINSTATEMENT OF THE APPLICATION OF THE
DAVIS-BACON PROVISIONS TO THE PROPOSED CONTRACT WORK."
TO THE SAME EFFECT, SEE PARAGRAGH B. OF THE MEMORANDUM ENTITLED
"REINSTATEMENT OF DAVIS-BACON ACT PROVISIONS" ISSUED BY THE ASSISTANT
SECRETARY OF DEFENSE ON MARCH 30, WHICH READS:
"B. SOLICITATIONS ISSUED AFTER FEBRUARY 23, 1971, BUT BEFORE MARCH
30, 1971, SHALL NOT CONTAIN THE DAVIS-BACON ACT PROVISIONS."
IN VIEW OF THE FOREGOING, WE ARE UNABLE TO AGREE WITH YOUR CONTENTION
THAT PRESIDENTIAL PROCLAMATION 4040 REINSTATED THE DAVIS-BACON ACT WITH
RESPECT TO IFB-0104, REVISED, OR THAT IT ELIMINATED THE COMPELLING
REASON WHICH PREVENTED AN AWARD UNDER IFB-0104. CONVERSELY, IT IS OUR
OPINION THAT PROCLAMATION 4040 CLEARLY INDICATES THAT PROCLAMATION 4031
WAS TO REMAIN IN EFFECT AS TO SOLICITATIONS ISSUED ON OR BEFORE MARCH
29. WHILE WE HAVE RECOGNIZED THE PROPRIETY OF REINSTATING THE ORIGINAL
BIDS WHERE NO RESOLICITATION WAS ISSUED BETWEEN FEBRUARY 23 AND MARCH
29, (SEE B-172640, MAY 12, 1971), AND WE AGREE THAT THE DEPARTMENT OF
LABOR'S MEMORANDUM #94 PERMITS AN AGENCY VOLUNTARILY TO AMEND A
RESOLICITATION ISSUED BETWEEN SUCH DATES SO AS TO INCLUDE DAVIS-BACON
ACT PROVISIONS, WE SEE NO VALID BASIS FOR CONCLUDING THAT IT IS
MANDATORY ON THE CONTRACTING AGENCY TO REINSTATE THE ORIGINAL BIDS UNDER
THE CIRCUMSTANCES IN THE INSTANT CASE. B-172102, APRIL 23, 1971.
WITH RESPECT TO YOUR ADVICE THAT THE WASHINGTON METROPOLITAN AREA
TRANSIT AUTHORITY (METRO) RECENTLY REINSTATED THE ORIGINAL BIDS UNDER
CIRCUMSTANCES SIMILAR TO THOSE IN THE PRESENT CASE, WE HAVE NO KNOWLEDGE
OF SUCH ACTION. HOWEVER, IT SHOULD BE NOTED THAT METRO IS A
QUASI-GOVERNMENTAL AGENCY WHOSE TRANSACTIONS ARE NOT SUBJECT TO THE SAME
CONSIDERATIONS AND RESTRAINTS AS ARE APPLICABLE TO AGENCIES AND
DEPARTMENTS OF THE FEDERAL GOVERNMENT, AND ITS ACTIONS THEREFORE ARE NOT
FOR CONSIDERATION IN DETERMINING THE PROPER COURSE TO BE FOLLOWED BY
FEDERAL AGENCIES.
IN VIEW THEREOF, AND SINCE IT IS OUR UNDERSTANDING THAT THE
DEPARTMENT OF THE NAVY DOES NOT CONSIDER IT PROPER TO AMEND IFB-0104,
REVISED, TO INCLUDE THE DAVIS-BACON ACT PROVISIONS, WE SEE NO BASIS FOR
OBJECTION TO AN AWARD BASED UPON THE BIDS SOLICITED AND RECEIVED UNDER
IFB-0104, REVISED, AS PRESENTLY CONSTITUTED.
ACCORDINGLY, YOUR PROTEST AGAINST SUCH ACTION MUST BE DENIED.
B-90867, MAY 17, 1971
RATE OF PAY - EXPERTS AND CONSULTANTS
DECISION THAT EXPERTS AND CONSULTANTS EMPLOYED UNDER THE PROVISIONS
OF 22 U.S.C. 2386 MAY NOT BE PAID IN EXCESS OF $100 PER DAY.
THE LEGISLATIVE HISTORY OF PUBLIC LAW 88-633 WHICH RAISED THE LIMIT
FROM $75 TO $100 PER DAY CLEARLY INDICATES A PURPOSE OF PAYING EXPERTS
AND CONSULTANTS AT RATES IN EXCESS OF GS-15 (NOW $121.28 PER DAY) BUT
ALSO SHOWS AN INTENT TO RESERVE THE FIXING OF THE SPECIFIC RATE
LIMITATION TO THE CONGRESS. THEREFORE, EXPERTS AND CONSULTANTS EMPLOYED
UNDER 22 U.S.C. 2386 MAY NOT BE PAID IN EXCESS OF $100 PER DAY.
TO MR. SECRETARY:
THIS IS IN REPLY TO LETTER OF MARCH 19, 1971, FROM THE ACTING
ASSISTANT SECRETARY FOR ADMINISTRATION, REQUESTING OUR DECISION AS TO
WHETHER EXPERTS AND CONSULTANTS EMPLOYED UNDER THE PROVISIONS OF 22
U.S.C. 2386 MAY BE PAID IN EXCESS OF $100 PER DAY.
UNDER THE PROVISIONS OF CHAPTER 32, TITLE 22, UNITED STATES CODE,
YOUR DEPARTMENT ENTERS INTO PARTICIPATING AGENCY SERVICE AGREEMENTS WITH
THE AGENCY FOR INTERNATIONAL DEVELOPMENT. UNDER THE TERMS OF SUCH
AGREEMENTS EXPERTS AND CONSULTANTS ARE EMPLOYED UNDER THE AUTHORITY OF
22 U.S.C. 2386, WHICH PROVIDES IN PART AS FOLLOWS:
"EXPERTS AND CONSULTANTS OR ORGANIZATIONS THEREOF MAY AS AUTHORIZED
BY SECTION 3109 OF TITLE 5 BE EMPLOYED FOR THE PERFORMANCE OF FUNCTIONS
UNDER THIS CHAPTER, AND INDIVIDUALS SO EMPLOYED MAY BE COMPENSATED AT
RATES NOT IN EXCESS OF $100 PER DIEM *** ." THE PREVIOUS LIMITATION OF
$75 PER DIEM WAS INCREASED TO THE CURRENT RATE BY SECTION 302(B)(1) OF
PUBLIC LAW 88-633, APPROVED OCTOBER 7, 1964. AT THE TIME OF THE
INCREASE THE TOP STEP OF GRADE GS-15 WAS $21,590 PER ANNUM, OR $83.04
PER DAY. AT THE PRESENT TIME THE TOP STEP OF GRADE GS-15 IS $31,523 PER
ANNUM, OR $121.28 PER DAY.
SINCE THE PER DIEM RATE WAS APPARENTLY SET TO AUTHORIZE PAYMENT OF
COMPENSATION TO THE EXPERTS AND CONSULTANTS INVOLVED IN EXCESS OF THE
TOP RATE FOR GS-15 AND SUCH RATE NOW EXCEEDS THE $100 LIMITATION, OUR
DECISION IS REQUESTED AS TO WHETHER THEY MAY BE COMPENSATED AT RATES NOT
TO EXCEED $121.28 PER DAY.
REGARDING THE INCREASE IN THE RATE LIMITATION PAGE 26 OF HOUSE REPORT
NO. 1443, 88TH CONGRESS, 2D SESSION, STATES THE FOLLOWING:
"SECTION 302(B) AMENDS SECTION 626 OF THE ACT WHICH RELATES TO
EXPERTS, CONSULTANTS AND RETIRED OFFICERS IN TWO RESPECTS.
"PARAGRAPH (1) AUTHORIZES AN INCREASE IN THE MAXIMUM COMPENSATION
THAT MAY BE PAID SUCH INDIVIDUALS FROM $75 PER DIEM TO $100 PER DIEM.
WHEN THE PRESENT LIMIT OF $75 PER DIEM WAS ESTABLISHED IN 1954, THE
ANNUAL EQUIVALENT OF THAT RATE WAS SUBSTANTIALLY HIGHER THAN THE SALARY
RATE FOR EMPLOYEES UNDER THE GENERAL SCHEDULE. SINCE THAT TIME SALARY
INCREASES FOR FEDERAL EMPLOYEES HAVE ELIMINATED THIS DIFFERENCE. THIS
FACT COMBINED WITH INCREASES IN PREVAILING RATES OUTSIDE THE GOVERNMENT
HAS SUBSTANTIALLY REDUCED THE INCENTIVE VALUE OF THE $75 PER DIEM RATE.
IN THE CURRENT FISCAL YEAR, 17 AGENCIES HAVE RECEIVED AUTHORIZATION TO
PAY A MAXIMUM RATE OF $100 PER DIEM TO EXPERTS AND CONSULTANTS."
WHILE THE ABOVE INDICATES THAT THE PURPOSE OF THE STATUTORY PROVISION
WAS TO AUTHORIZE PAYMENT TO THE EXPERTS AND CONSULTANTS IN QUESTION AT
RATES IN EXCESS OF THAT FOR THE TOP OF GRADE GS-15, IT ALSO SHOWS AN
INTENT TO RESERVE THE FIXING OF THE SPECIFIC RATE LIMITATION TO THE
CONGRESS. MOREOVER, THE AUTHORITY CONFERRED BY PUBLIC LAW 88-633 TO
PERMIT PAYMENT AT RATES NOT IN EXCESS OF $100 PER DIEM TO EXPERTS AND
CONSULTANTS IS COMPLETELY INDEPENDENT OF THE AUTHORITY IN 5 U.S.C. 3109
TO PERMIT PAYMENT TO EXPERTS AND CONSULTANTS GENERALLY AT RATES NOT IN
EXCESS OF THE RATE FOR GS-15. SEE B-147212, OCTOBER 4, 1961, COPY
ENCLOSED.
IN VIEW OF THE ABOVE IT IS OUR OPINION THAT THE EXPERTS AND
CONSULTANTS IN QUESTION MAY NOT BE PAID AT RATES IN EXCESS OF $100 PER
DIEM.
B-168161, MAY 14, 1971
CIVILIAN EMPLOYEE - RECRUITED OUTSIDE UNITED STATES - QUARTERS ALLOWANCE
ADVISING THAT MRS. RUSSELLE HEDLEY IS NOT ENTITLED TO QUARTERS
ALLOWANCE UNDER SECTION 031.12 OF THE STANDARDIZED REGULATIONS (ARMY)
BECAUSE SHE WAS NOT RECRUITED IN THE UNITED STATES.
TO MR. CECIL DRIVER:
WE HAVE RECEIVED YOUR LETTER OF MARCH 12, 1971, AND NOTE THAT YOU
FEEL THIS OFFICE HAS BEEN LESS THAN RESPONSIVE TO YOUR PREVIOUS LETTERS
AND INQUIRIES. YOUR CONCERN SEEMS TO STEM FROM THE FACT THAT WE HAVE
NOT RENDERED DECISIONS REGARDING THE FACT SITUATIONS OF CERTAIN TEACHERS
WHICH YOU HAVE RELATED IN YOUR VARIOUS LETTERS.
WE HAVE PREVIOUSLY ADVISED YOU OF THE LIMITATION UPON OUR AUTHORITY
TO RENDER DECISIONS AND RECOMMENDED THAT YOU ADVISE SUCH OF THE TEACHERS
IN YOUR ASSOCIATION WHO FEEL THAT THEY HAVE BEEN WRONGLY DENIED QUARTERS
OR A QUARTERS ALLOWANCE TO SUBMIT MONETARY CLAIMS TO OUR CLAIMS
DIVISION.
YOU INQUIRE AS TO THE STATUS OF THE CLAIMS OF FIVE MEMBERS OF YOUR
ASSOCIATION. WE ARE UNABLE TO LOCATE ANY RECORD OF THE RECEIPT OF THE
CLAIMS OF EITHER MRS. ROSARIO WENZL OR MRS. JEANETTE SUTTON. WE ARE
FORWARDING COPIES OF THEIR CLAIMS WHICH YOU HAVE ENCLOSED WITH YOUR
LETTER TO OUR CLAIMS DIVISION FOR CONSIDERATION. ALTHOUGH WE HAVE NO
RECORD OF RECEIPT OF MRS. CAROL ECKERT'S CLAIM DATED JUNE 8, 1970,
ADDRESSED TO OUR CLAIMS DIVISION, WE DID HAVE OCCASION, IN RESPONSE TO
AN INQUIRY FROM A MEMBER OF CONGRESS, TO CONSIDER HER CLAIM OF
ENTITLEMENT TO A QUARTERS ALLOWANCE. WE TRUST THAT SHE HAS BEEN ADVISED
OF OUR POSITION IN HER CASE. IF SHE DESIRES TO FURNISH ADDITIONAL
EVIDENCE TO THE CLAIMS DIVISION, HER CLAIM WILL BE FURTHER CONSIDERED.
AS YOU WILL RECALL FROM OUR DECISION OF JUNE 19, 1970, DEALING WITH
THE ISSUE OF WHETHER, UNDER SECTION 031.13 OF THE STANDARDIZED
REGULATIONS, MRS. RUSSELLE HEDLEY WAS THE MEMBER OF THE FAMILY WHOSE JOB
DETERMINED THE LOCATION OF THE FAMILY, WE INFORMED YOU THAT WE WERE
TRANSMITTING THE PAPERS IN HER CASE TO THE SECRETARY OF THE ARMY FOR
RECONSIDERATION OF HER CLAIM IN LIGHT OF OUR DECISION. WE HAVE RECEIVED
THE ARMY'S DETERMINATION WITH REGARD TO HER ELIGIBILITY, AND YOU WILL BE
ADVISED SHORTLY OF THE FINAL RESOLUTION IN MRS. HEDLEY'S CASE.
DETERMINATION OF THE AMOUNT DUE MRS. HENRIETTA PELLECCHIA PURSUANT TO
OUR DECISION B-168161 OF JUNE 19, 1970, IS AWAITING RECEIPT OF A REPORT
WHICH WE REQUESTED ON NOVEMBER 6, 1970, FROM THE DEPARTMENT OF THE AIR
FORCE. WE WERE ADVISED BY THE AIR FORCE ACCOUNTING AND FINANCE CENTER
THAT THE FILE HAD BEEN FORWARDED TO HQ PACAF (ACF) FOR ITS ACTION AND
RETURN OF THE INFORMATION REQUESTED. MRS. PELLECCHIA WAS ADVISED ON
FEBRUARY 10, 1971, THAT UPON RECEIPT OF THE INFORMATION PROMPT ATTENTION
WOULD BE GIVEN THE MATTER.
B-170808, MAY 14, 1971
CONTRACTS - MODIFICATION - REDUCED REQUIREMENTS
DECISION AUTHORIZING AN INCREASE NOT TO EXCEED $1,000 IN THE CONTRACT
PRICE BID BY ALTON IRON WORKS, INC., INCIDENT TO AN IFB ISSUED BY THE
DEFENSE SUPPLY AGENCY FOR 73 HEADLIGHT MOUNTING ADAPTERS.
ALTHOUGH SUCCESSFUL LOW BIDDER, ALTON, DID NOT QUALIFY ITS BID WITH
"ALL OR NONE" LANGUAGE, THE CONTRACTING OFFICER KNEW, OR SHOULD HAVE
KNOWN, PRIOR TO BID OPENING THAT THE REQUIREMENT HAD BEEN REDUCED BY 38
PERCENT AND SHOULD HAVE ADVISED ALTON OF THE REDUCED QUANTITY WHEN
SEEKING VERIFICATION OF ITS BID PRICE. THE REQUEST BY ALTON TO MODIFY
THE CONTRACT WAS NOT DENIED UNTIL SIX MONTHS AFTER AWARD AND AFTER THE
CONTRACT WAS COMPLETED. ACCORDINGLY, THE AGGREGATE TOTAL PRICE MAY BE
INCREASED BY AN AMOUNT NOT TO EXCEED $1,000.
TO GENERAL HEDLUND:
REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 30, 1970, DSAH-G, WITH
ENCLOSURES, FURNISHING A REPORT ON THE REQUEST OF ALTON IRON WORKS,
INCORPORATED (ALTON), FOR AN ADJUSTMENT IN THE PRICE OF CONTRACT DSA
400-70-C-2100, ISSUED BY THE DEFENSE GENERAL SUPPLY CENTER, RICHMOND,
VIRGINIA.
THE CONTRACT WAS AWARDED PURSUANT TO INVITATION FOR BIDS NO. DSA
400-70-B-1437, DATED SEPTEMBER 2, 1969. BIDS WERE REQUESTED ON THE
BASIS OF F.O.B. DESTINATION PRICES ON THREE ITEMS, COVERING AN AGGREGATE
QUANTITY OF 73 HEADLIGHT MOUNTING ADAPTERS.
THE RECORD SHOWS THAT SUBSEQUENT TO THE ISSUANCE OF THE INVITATION
AND PRIOR TO BID OPENING, AMENDMENT NO. 2 OF THE BASIC MIPR WAS PREPARED
BY THE AIR FORCE AND RECEIVED BY THE MIPR COORDINATOR AT THE RICHMOND
DEFENSE GENERAL SUPPLY CENTER ON SEPTEMBER 24, 1969, DECREASING THE
NUMBER OF UNITS REQUIRED FROM 73 TO 45. HOWEVER, BIDDERS WERE NOT
ADVISED OF THE REDUCED REQUIREMENT BY AMENDMENT OR OTHERWISE.
THREE BIDS WERE RECEIVED AS OF OCTOBER 2, 1969, THE SCHEDULED BID
OPENING DATE. ALTON'S BID PRICE OF $88 PER UNIT, WITH NO QUANTITY
RESTRICTIONS, WAS THE LOWEST RECEIVED. THE OTHER TWO BIDS IN THE
AMOUNTS OF $126.37 AND $232.50 PER UNIT, RESPECTIVELY, WERE ON AN "ALL
OR NONE" BASIS FOR 73 UNITS.
BY LETTER DATED OCTOBER 3, 1969, THE CONTRACTING OFFICER ADVISED
ALTON THAT ITS BID WAS SUBSTANTIALLY LOWER THAN THE OTHER BIDS RECEIVED
AND REQUESTED CONFIRMATION OF ITS BID PRICE. BY LETTER DATED OCTOBER 6,
1969, ALTON CONFIRMED ITS BID PRICE, STATING THE FOLLOWING:
" *** WE CONFIRM OUR BID PRICE OF $88.00 EACH FOR 73 UNITS ON ABOVE
REFERENCED PROCUREMENT." ON NOVEMBER 4, 1969, AWARD WAS MADE TO ALTON
FOR 45 UNITS.
BY LETTER DATED NOVEMBER 13, 1969, ALTON ADVISED THE PROCURING
ACTIVITY THAT THERE WAS A MISTAKE IN THE BID AS IT HAD ERRONEOUSLY
COMPUTED ITS BID PRICE ON A QUANTITY OF 73 UNITS AS CALLED FOR IN THE
INVITATION. ALTON INCLUDED COMPUTATIONS IN THE LETTER TO ESTABLISH A
UNIT PRICE OF $119.03 FOR 45 UNITS, OR A TOTAL PRICE INCREASE OF $1,440.
HOWEVER, IT AGREED TO ACCEPT AN INCREASE OF $1,000. ALTON CONTENDS THAT
IT IS UNCONSCIONABLE TO HOLD IT TO ITS LOWER PRICE FOR 73 UNITS WHEN THE
CONTRACTING OFFICER FAILED TO AMEND THE INVITATION OR ADVISE IT OF THE
REDUCED QUANTITY WHEN SEEKING VERIFICATION OF ITS BID PRICE.
ALTON WAS REQUESTED BY LETTER DATED DECEMBER 8, 1969, TO ADVISE IF IT
WISHED THE CONTRACT RESCINDED IF MODIFICATION COULD NOT BE GRANTED. IN
RESPONSE THERETO ALTON ADVISED THAT IT WAS PROCEEDING WITH THE CONTRACT
AND HAD COMPLETED THE ENGINEERING DRAWINGS; THAT IT HAD ISSUED PURCHASE
ORDERS FOR THE COMMERCIAL PARTS, CASTINGS, PATTERNS AND STAMPINGS, AND
THAT IT WISHED TO RESERVE THE RIGHT TO REQUEST RESCISSION OF THE
CONTRACT IF MODIFICATION COULD NOT BE GRANTED.
THE CONTRACTING OFFICER DETERMINED THAT THERE WAS NO CLEAR AND
CONVINCING EVIDENCE THAT ALTON MADE A MISTAKE IN THE PREPARATION AND
SUBMISSION OF ITS BID TO WARRANT AN INCREASE IN BID PRICE AS
CONTEMPLATED BY ASPR 2-406.4, AND SO ADVISED ALTON ON JUNE 10, 1970.
THE BASIS FOR DENIAL OF ALTON'S REQUEST FOR A CONTRACT PRICE
ADJUSTMENT IS CONTAINED IN A DETERMINATION AND FINDINGS DATED JUNE 10,
1970, WHICH STATES IN PART AS FOLLOWS:
" *** THE CONTRACTING OFFICER DOES NOT BELIEVE THAT A MISTAKE IN BID
WAS MADE. BOTH CONFIRMATION OF THE UNIT PRICE AND A PRE-AWARD SURVEY
WERE OBTAINED. THE PRICE IS HIGHER THAN THE MOST RECENT PRICE SHOWN FOR
A SMALLER QUANTITY. ALTON IS FAMILIAR WITH THE BIDDING FORMS AND
PROCEDURES OF THE CENTER. CONSEQUENTLY, IT IS AWARE THAT PARAGRAPH
10(C) OF STANDARD FORM 33A USED IN THIS PROCUREMENT AND MOST OF THE
PROCUREMENT OF THIS CENTER PERMITS THE GOVERNMENT TO MAKE AN AWARD FOR A
QUANTITY LESS THAN THE QUANTITY OFFERED AT THE UNIT PRICES OFFERED
UNLESS THE OFFEROR SPECIFIES OTHERWISE IN ITS BID. FURTHERMORE, WHEN AN
INVITATION REQUESTS BIDS ON DELIVERING VARYING QUANTITIES OF SUPPLIES
F.O.B. VARIOUS DELIVERY POINTS, IT IS NOT UNUSUAL FOR MORE THAN ONE
AWARD TO BE MADE. IN THIS INSTANCE WITHOUT ANY OVERALL QUANTITY
REDUCTION A BIDDER COULD NEVERTHELESS EXPECT THAT IT MIGHT BE LOW ON
ONLY 6 UNITS (SUBITEM 1) OR 7 UNITS (SUBITEM 2). NONE OF THE INFORMATION
ON THE WORK SHEET CLEARLY ESTABLISHES THAT A MISTAKE WAS MADE. IT DOES
ESTABLISH THAT CERTAIN TOOLING AND SET UP COSTS WERE CALCULATED AND
AMORTIZED OVER 73 UNITS. ACCORDINGLY, IF A MISTAKE WERE MADE IN THAT
COSTS WERE VALID ONLY IF 73 UNITS WERE INVOLVED, THEN THE MISTAKE, IF
ANY, MUST LIE IN NOT SUBMITTING AN 'ALL OR NONE' BID."
WE AGREE WITH THE CONTRACTING OFFICER'S DETERMINATION THAT ALTON IS
NOT ENTITLED TO AN INCREASE IN THE CONTRACT PRICE BASED ON A MISTAKE IN
ITS BID PRICE. HOWEVER, WE AGREE WITH ALTON'S CONTENTION THAT IT WOULD
BE UNCONSCIONABLE TO HOLD IT TO THE CONTRACT PRICE IN THE CIRCUMSTANCES
SURROUNDING THE AWARD OF THE CONTRACT. ALTHOUGH THE CONTRACTING OFFICER
KNEW, OR SHOULD HAVE KNOWN, PRIOR TO BID OPENING THAT THE REQUIREMENT
HAD BEEN REDUCED BY SOME 38 PERCENT, HE FAILED TO COMPLY WITH THE
REQUIREMENT OF ASPR 2-208 THAT SUCH CHANGE SHALL BE ACCOMPLISHED BY
AMENDMENT OF THE INVITATION. MORE THAN A MONTH AFTER THE CONTRACT WAS
AWARDED, ALTON WAS ASKED TO ADVISE WHETHER IT WISHED TO RESCIND THE
CONTRACT IF IT COULD NOT BE MODIFIED. ALTHOUGH ALTON ADVISED THAT IT
WAS PROCEEDING WITH PERFORMANCE, ITS REQUEST WAS NOT DENIED UNTIL SIX
MONTHS LATER AND APPARENTLY AFTER THE CONTRACT WAS COMPLETED.
WE RECOGNIZE THAT UNDER PARAGRAPH 10 OF THE SOLICITATION INSTRUCTIONS
AND CONDITIONS OF SF 33 THE GOVERNMENT HAS THE RIGHT TO MAKE AN AWARD
FOR A QUANTITY LESS THAN THE OFFERED QUANTITY AT THE UNIT PRICES OFFERED
UNLESS THE BIDDER SPECIFIES OTHERWISE IN HIS BID. HOWEVER, WE DO NOT
BELIEVE RELIANCE ON THIS PROVISION TO JUSTIFY ACCEPTANCE OF ALTON'S BID
IN THE CIRCUMSTANCES PRESENT HERE IS A PROPER APPLICATION OF SUCH RIGHT.
THE RECORD INDICATES THAT DELIVERIES UNDER THE CONTRACT HAVE BEEN
COMPLETED BY ALTON. ACCORDINGLY, YOU ARE ADVISED THAT A SUPPLEMENTAL
AGREEMENT SHOULD BE EXECUTED INCREASING THE AGGREGATE TOTAL CONTRACT
PRICE BY AN APPROPRIATE AMOUNT NOT TO EXCEED $1,000.
A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE SUPPLEMENTAL
AGREEMENT.
B-171105, B-171303, MAY 14, 1971
BID PROTEST - MULTIPLE AWARDS - LOWEST COST
BASED ON AN ERROR USED IN THE COMPUTATION OF TRANSPORTATION COSTS,
THE COMP. GEN. OVERRULES PRIOR DECISIONS B-171105, AND B-171103,
FEBRUARY 23, 1971, AND MARCH 25, 1971, WHICH HELD THAT A SINGLE AWARD TO
EXIDE WAS LOWER THAN SPLIT AWARDS TO EXIDE, GOULD, INC., AND C & D
BATTERIES.
BECAUSE COSTS WERE BASED ON SHIPMENTS FROM C & D'S PLANT IN INDIANA
AND IT IS NOW CLEAR THAT SHIPMENTS OF ELECTROLYTE TO POINTS IN
CALIFORNIA COULD HAVE ORIGINATED FROM C & D'S SANTA ROSA PLANT, A SPLIT
AWARD WOULD RESULT IN A SAVINGS OF $653 TO THE GOVERNMENT.
TO SELLERS, CONNER & CUNEO:
REFERENCE IS MADE TO YOUR LETTER DATED APRIL 5, 1971, WITH ENCLOSURE,
ON BEHALF OF GOULD, INCORPORATED, AND C & D BATTERIES DIVISION OF ELTRA
CORPORATION, REQUESTING RECONSIDERATION OF OUR DECISIONS OF FEBRUARY 23,
1971, AND MARCH 25, 1971, B-171105, B-171303.
IN OUR DECISION OF MARCH 25, 1971, WE STATED THAT OUR REVIEW OF THE
TRANSPORTATION COSTS INVOLVED SHOWED THE SINGLE AWARD TO EXIDE TO BE
$105 LOWER THAN SPLIT AWARDS TO EXIDE, GOULD, AND C & D BATTERIES. WE
ALSO INDICATED THAT ANOTHER $100 IN ADMINISTRATIVE COSTS MIGHT HAVE TO
BE CONSIDERED IF THREE AWARDS WERE MADE, MAKING A TOTAL OF $205 IN FAVOR
OF A SINGLE AWARD.
ON APRIL 5, 1971, WE WERE ASKED TO RECONSIDER OUR DECISION ON THE
BASIS OF AN ALLEGED ERROR IN THE METHOD USED IN COMPUTING THE COST OF
TRANSPORTATION FOR ELECTROLYTE UNDER ITEM 6 (LOT II) AND ITEM 14 (LOT
V). IN THE PRIOR COMPUTATIONS THIS COST WAS BASED ON SHIPMENTS FROM C &
D'S PLANT IN INDIANA.
THE POSITION TAKEN IN C & D'S LETTER OF APRIL 5, 1971, IS THAT THE
ELECTROLYTE REQUIRED TO BE SHIPPED TO DESTINATIONS IN CALIFORNIA CAN AND
SHOULD BE SHIPPED FROM C & D'S PLANT IN SANTA ROSA, CALIFORNIA. IT IS
TRUE THAT THE SOLICITATION REQUIRED ELECTROLYTE TO BE FURNISHED IN
SEPARATE CONTAINERS. IT IS ALSO TRUE THAT EACH BIDDER FURNISHED
GUARANTEED SHIPPING WEIGHT INFORMATION FOR ELECTROLYTE IN SEPARATE
CONTAINERS. THE INVITATION FURTHER PROVIDED THAT THE GOVERNMENT WOULD
EVALUATE TRANSPORTATION COSTS FROM THAT PLANT OF THE BIDDER WHICH
RESULTED IN THE MOST FAVORABLE TRANSPORTATION COST TO THE GOVERNMENT.
WE HAVE COMPARED THE COST OF SHIPPING THE ELECTROLYTE FROM INDIANA
WITH THE COST FROM SANTA ROSA, AND OUR COMPUTATIONS SHOW THE LATTER TO
BE CHEAPER BY SOME $822, INSTEAD OF THE $915 CLAIMED BY C & D. THUS, IF
THE ELECTROLYTE WERE SHIPPED FROM SANTA ROSA, SPLIT AWARDS WOULD
EVALUATE AT SOME $653 LESS THAN THE SINGLE AWARD TO EXIDE. THE
SOLICITATION DOES NOT SPECIFY WHETHER ELECTROLYTE IS TO BE SHIPPED WITH
THE RELATED BATTERIES OR SEPARATELY, SO IT APPEARS THAT SEPARATE
SHIPMENT WOULD BE PERMISSIBLE. THE ONLY QUALIFICATION WE HAVE AS TO THE
ACCEPTABILITY OF SHIPPING THE ELECTROLYTE FROM THE SANTA ROSA PLANT
ARISES FROM THE FACT THAT THE C & D BID, IN LISTING THAT PLANT AS A
SHIPPING POINT, USED THE FOLLOWING LANGUAGE: "265 ROBERTS AVE., SANTA
ROSA, SONOMA, CALIF. (WET & CHARGED ONLY)."
IT IS NOW STATED THAT THE PHRASE "WET & CHARGED ONLY" WAS INTENDED TO
INDICATE ONLY THAT "CHARGED AND DRY" BATTERIES COULD NOT BE SHIPPED BY
THE SANTA ROSA PLANT. THE WORDS "CHARGED AND DRY" MEAN THAT THE BATTERY
HAS BEEN FILLED WITH ELECTROLYTE AND CHARGED. THE ELECTROLYTE IS THEN
REMOVED AND THE BATTERY IS PUT THROUGH A SPECIAL DRYING PROCESS WHICH
REQUIRES EQUIPMENT NOT AVAILABLE AT THE SANTA ROSA PLANT. SUCH
BATTERIES WILL KEEP IN STORAGE FOR SEVERAL YEARS AND WHEN FILLED WITH
ELECTROLYTE WILL HAVE ABOUT 80 PERCENT OF A FULL CHARGE. THIS MEANS
THEY CAN BE PUT IN SERVICE AFTER A SHORT PERIOD OF CHARGING, WHEREAS A
DRY AND UNCHARGED BATTERY HAS NO CHARGE WHEN FIRST FILLED WITH
ELECTROLYTE AND REQUIRES A MUCH LONGER PERIOD OF CHARGING BEFORE IT CAN
BE USED. OBVIOUSLY, THE SANTA ROSA PLANT HAS ELECTROLYTE SINCE IT CAN
DELIVER WET CHARGED BATTERIES, AND C & D ALLEGES IT TO BE ITS COMMERCIAL
PRACTICE TO SHIP ELECTROLYTE FROM ITS SANTA ROSA PLANT TO CALIFORNIA
DESTINATIONS EVEN WHEN DRY CHARGED BATTERIES ARE SHIPPED FROM ITS
INDIANA PLANT.
IT IS OUR OPINION THAT THE DESCRIPTION OF THE SANTA ROSA PLANT AS A
SOURCE OF WET AND CHARGED BATTERIES ONLY WAS NOT INTENDED TO AND DID NOT
DISQUALIFY THAT PLANT AS A SOURCE OF ELECTROLYTE SHIPPED SEPARATELY. WE
THEREFORE BELIEVE IT IS PROPER TO COMPUTE TRANSPORTATION COSTS ON
ELECTROLYTE FROM THE SANTA ROSA PLANT WHEN THIS RESULTS IN A LOWER COST
TO THE GOVERNMENT.
AS STATED, C & D'S CONTENTION WITH RESPECT TO SHIPMENT OF ELECTROLYTE
FROM ITS SANTA ROSA PLANT WAS NOT PRESENTED TO US UNTIL AFTER OUR
DECISION OF MARCH 25, 1971. IN VIEW OF THE FACT THAT THIS MATTER IS NOW
PENDING BEFORE THE COURTS AND SINCE THIS ASPECT HAD NOT BEEN CONSIDERED
PREVIOUSLY, WE FELT IT NECESSARY TO EXPRESS OUR OPINION SINCE IT LEADS
TO A RESULT CONTRARY TO THAT EXPRESSED IN OUR PRIOR DECISION.
B-171435, MAY 14, 1971
BID PROTEST - BID RESPONSIVENESS - BUILDING PERMIT
DECISION SUSTAINING PROTEST BY GLOPAR ASSOCIATES LTD., AGAINST THE
NEGOTIATIONS OF A LEASE WITH HERBERT CASHVAN FOR RENTAL OF SPACE NEEDED
TO SATISFY A REQUIREMENT OF THE DEPARTMENT OF THE NAVY.
THE RECORD INDICATES THAT WHILE GLOPAR'S BID WAS REJECTED BECAUSE ITS
BUILDING PERMIT DID NOT COVER THE MECHANICAL AND ELECTRICAL PLANS OF THE
BUILDING'S SECOND FLOOR, THE PLANS OFFERED BY CASHVAN WERE NOT FURNISHED
UNTIL SIX MONTHS AFTER THE SOLICITATION DATE. THUS NEITHER OFFER WAS
SUPPORTED BY A BUILDING PERMIT FOR THE "CONSTRUCTION OF AN ENTIRE
BUILDING, EXTENSION OR ADDITION" AS REQUIRED BY THE SOLICITATION.
THEREFORE, GLOPAR SHOULD BE READMITTED TO THE NEGOTIATIONS OR THERE
SHOULD BE A RESOLICITATION FOR THE REQUIREMENTS.
TO MR. KUNZIG:
WE REFER TO REPORTS SUBMITTED BY YOUR GENERAL COUNSEL IN CONNECTION
WITH THE PROTEST OF GLOPAR ASSOCIATES LTD. AGAINST THE NEGOTIATION OF A
LEASE WITH HERBERT CASHVAN UNDER SOLICITATION NO. 31 DATED MAY 20, 1970.
THE SOLICITATION REQUESTED OFFERS TO BE SUBMITTED BY JUNE 5, 1970, TO
LEASE 85,000 SQUARE FEET OF NET USABLE SPACE, PLUS OR MINUS 5 PERCENT,
AT A LOCATION WITHIN 10 MILES OF SEWELLS POINT NAVAL COMPLEX, NORFOLK,
VIRGINIA, NORTH OF THE EASTERN BRANCH OF THE ELIZABETH RIVER. OFFERS
WERE REQUESTED ON A FIRM 8-YEAR LEASE WITH TWO 5-YEAR RENEWAL TERMS.
THE SPACE IS NEEDED TO SATISFY A REQUIREMENT OF THE DEPARTMENT OF THE
NAVY.
PARAGRAPH 11 OF SCHEDULE "D" OF THE SOLICITATION PROVIDED AS FOLLOWS:
"SPECIAL CONDITIONS RELATING TO BUILDING TO BE ERECTED BY BIDDER
"A. REQUIREMENT. EACH YEAR SINCE 1963 THE FOLLOWING PROVISION HAS
BEEN INCLUDED IN THE INDEPENDENT OFFICES APPROPRIATIONS ACT:
"'NO PART OF ANY APPROPRIATION CONTAINED IN THIS ACT SHALL BE USED
FOR THE PAYMENT OF RENTAL ON LEASE AGREEMENTS FOR THE ACCOMMODATION OF
FEDERAL AGENCIES IN BUILDINGS AND IMPROVEMENTS WHICH ARE TO BE ERECTED
BY THE LESSOR FOR SUCH AGENCIES AT AN ESTIMATED COST OF CONSTRUCTION IN
EXCESS OF $200,000 OR FOR THE PAYMENT OF THE SALARY OF ANY PERSON WHO
EXECUTES SUCH A LEASE AGREEMENT: ***
"B. DEFINITION OF EXISTING BUILDINGS, EXTENSION, AND ADDITIONS.
"(1) FOR THE PURPOSE OF THIS SOLICITATION, BUILDINGS, EXTENSIONS OR
ADDITIONS 'WHICH ARE TO BE ERECTED BY THE LESSOR' DO NOT INCLUDE:
"(A) BUILDINGS, EXTENSIONS, OR ADDITIONS, CONSTRUCTION OF WHICH IS
SUBSTANTIALLY COMPLETED PRIOR TO DATE OF THE SOLICITATION.
"(B) NEW BUILDINGS, OR EXTENSIONS OF AND ADDITIONS TO EXISTING
BUILDINGS THE CONSTRUCTION STATUS OF WHICH, ON THE DATE OF ISSUANCE OF
THE SOLICITATION, MET ALL OF THE FOLLOWING CONDITIONS:
"I. TITLE TO THE SITE WAS VESTED IN THE OFFEROR OR HE POSSESSED SUCH
OTHER INTEREST IN AND DOMINION AND CONTROL OVER THE SITE TO ENABLE
STARTING CONSTRUCTION.
"II. DESIGN WAS COMPLETE.
"III. CONSTRUCTION FINANCING FULLY COMMITTED.
"IV. A BUILDING PERMIT FOR CONSTRUCTION OF THE ENTIRE BUILDING,
EXTENSION OR ADDITION HAD BEEN ISSUED.
"V. ACTUAL CONSTRUCTION IS CURRENTLY IN PROGRESS OR A FIRM
CONSTRUCTION CONTRACT WITH A FIXED CONPLETION DATE HAS BEEN ENTERED
INTO."
THE PURPOSE AND INTENT OF THE FOREGOING PROVISIONS ARE TO ASSURE THAT
IN THE CASE OF NEW CONSTRUCTION ONLY THAT CONSTRUCTION ALREADY COMMITTED
AS A PRIVATE VENTURE MAY BE OFFERED TO THE GOVERNMENT FOR RENTAL.
THREE OFFERS WERE RECEIVED: HERBERT CASHVAN, GLOPAR ASSOCIATES LTD.
AND GOODMAN-SEGAR-HOGAN, INC. THE OFFER OF THE LATTER WAS REJECTED, WE
ARE ADVISED, BECAUSE IT OFFERED A NEW BUILDING FOR WHICH A BUILDING
PERMIT HAD NOT BEEN ISSUED BY MAY 20, 1970 (THE SOLICITATION DATE). NO
OTHER INFORMATION REGARDING THIS REJECTED OFFER IS OF RECORD IN OUR
OFFICE. WE DO, HOWEVER, HAVE INFORMATION ON THE GLOPAR OFFER AND ITS
REJECTION.
GLOPAR PROPOSED TO ADD A SECOND FLOOR TO AN EXISTING BUILDING ALREADY
OCCUPIED BY THE NAVY, AND CASHVAN PROPOSED TO OFFER A BUILDING "UNDER
CONSTRUCTION." HOWEVER, THE GLOPAR OFFER WAS REJECTED BECAUSE, IN THE
WORDS OF THE INITIAL REPORT, "DOCUMENTATION SUBMITTED WITH THE OFFER
DISCLOSED THAT THE FOREGOING CRITERIA HAD NOT BEEN MET AS OF DATE OF THE
SOLICITATION." WHILE "FOREGOING CRITERIA" APPARENTLY HAS REFERENCE TO
THE ABOVE-QUOTED CONDITIONS WHICH IMPLEMENT THE STATUTORY LIMITATION, IT
NOW APPEARS THAT THE ONLY CRITERION INVOLVED WAS THAT CONCERNING THE
BUILDING PERMIT. THE DETAILS RELATING TO THE GLOPAR OFFER AND ITS
REJECTION WERE NOT INCLUDED IN THE GENERAL SERVICES ADMINISTRATION (GSA)
REPORTS. IN CONNECTION WITH ITS PROTEST, GLOPAR SUBMITTED TO US THREE
PIECES OF CORRESPONDENCE BETWEEN IT AND GSA WHICH MAKE IT DIFFICULT FOR
US TO DISTINGUISH BETWEEN THE CASHVAN AND GLOPAR OFFERS INSOFAR AS
COMPLIANCE WITH THE BUILDING PERMIT REQUIREMENT IS CONCERNED. IN A
LETTER DATED NOVEMBER 17, 1970, TO GLOPAR, THE ACTING DIRECTOR, SPACE
MANAGEMENT DIVISION, OFFICE OF OPERATING PROGRAMS, REGION 3, REFERS TO
GLOPAR LETTERS OF JULY 23 AND OCTOBER 28, 1970. THESE LETTERS AND THE
NOVEMBER 17 REPLY ESTABLISH, TO OUR SATISFACTION, THAT GLOPAR'S OFFER
WAS REJECTED BECAUSE ITS BUILDING PERMIT DID NOT AUTHORIZE CONSTRUCTION
OF THE ENTIRE SECOND FLOOR TO ITS EXISTING BUILDING. SPECIFICALLY, IT
WAS STATED THE BUILDING PERMIT DID NOT COVER THE MECHANICAL AND
ELECTRICAL DETAILS OF THE SECOND FLOOR. YET, THE MECHANICAL AND
ELECTRICAL PLANS OF THE BUILDING OFFERED BY CASHVAN WERE NOT FURNISHED
UNTIL APPROXIMATELY NOVEMBER 18, 1970, OR ABOUT 6 MONTHS AFTER THE
SOLICITATION DATE. ESSENTIALLY, THEN, THE BUILDING PERMIT DEFECTS WERE
SIMILAR IN BOTH THE GLOPAR AND CASHVAN OFFERS.
WE ARE CONCERNED THAT THE BASES FOR REJECTION OF THE GLOPAR OFFER
WERE NEITHER FURNISHED NOR JUSTIFIED TO OUR OFFICE, WHILE THE
ACCEPTABILITY OF THE CASHVAN OFFER IS JUSTIFIED IN DETAIL BY FORMAL
SUBMISSIONS.
IN A STRICT SENSE, NEITHER OFFER WAS SUPPORTED BY A BUILDING PERMIT
FOR THE "CONSTRUCTION OF AN ENTIRE BUILDING, EXTENSION OR ADDITION." WHY
GSA CHOSE TO DISREGARD THE BUILDING PERMIT DEFECT IN THE CASE OF CASHVAN
AND ENFORCE IT IN THE CASE OF GLOPAR IS UNEXPLAINED.
WE HAVE MADE AN INDEPENDENT REVIEW OF THE CIRCUMSTANCES OF THIS
PROTEST AND, BASED ON OUR FINDINGS AND THE FACTS OF RECORD NOW BEFORE
US, WE HAVE THE FOLLOWING COMMENTS TO OFFER.
WITH RESPECT TO THE CRITERION RESPECTING THE COMPLETENESS OF DESIGN,
IT IS CLEAR FROM THE RECORD THAT MECHANICAL AND ELECTRICAL DESIGNS WERE
NOT SUBMITTED BY CASHVAN AT LEAST UNTIL NOVEMBER 17, 1970. IN THIS
REGARD, THE BUILDING PERMIT ISSUED TO CASHVAN PROVIDED:
"THIS PERMIT IS GRANTED ONLY FOR WORK SHOWN ON PLANS AND APPLICATION
FORMS FILED FOR THIS JOB."
AS OF THE CRITICAL POINT IN TIME - MAY 20, 1970 - CASHVAN HAD
SUBMITTED THESE PLANS OR DESIGNS: PILE PLAN 1; FIRST-FLOOR FRAMING
PLAN; TYPICAL FLOOR FRAMING PLAN; FIRST-FLOOR PLAN; TYPICAL FLOOR
PLAN; ROOF PLAN; AND TYPICAL SECTIONS. TYPICAL MECHANICAL PLAN,
FIRST-FLOOR LIGHTING PLAN AND TYPICAL LIGHTING PLAN WERE PREPARED BY
CASHVAN'S ARCHITECT ON NOVEMBER 17, 1970.
THUS, CASHVAN'S DESIGN WAS APPARENTLY NO MORE COMPLETE THAN GLOPAR'S
AS OF MAY 20, 1970.
AS STATED ABOVE, THE BUILDING PERMIT ISSUED TO CASHVAN DID NOT COVER
MECHANICAL OR ELECTRICAL DESIGN. MUCH HAS BEEN MADE OF THE FACT THAT
THE BUILDING PERMIT WAS, IN FACT, "ISSUED" TO CASHVAN ON MAY 18, 1970.
WE HAVE VERIFIED THAT THE PERMIT WAS ACTUALLY PICKED UP BY CASHVAN ON
MAY 27, 1970, BUT THAT IT WAS BACKDATED TO MAY 18, 1970, AS AN
ACCOMMODATION TO MR. CASHVAN. WITHOUT DECIDING THE LEGAL DATE OF
"ISSUANCE" - WHICH IS NOT CRUCIAL TO OUR DECISION - WE BELIEVE THAT THE
BUILDING PERMIT DID NOT FULLY SATISFY THE SOLICITATION CRITERION THAT IT
BE FOR THE ENTIRE BUILDING.
WE BELIEVE THAT THE RECORD NOW BEFORE OUR OFFICE REQUIRES THE
CONCLUSION THAT THE GLOPAR PROTEST HAS MERIT AND THAT IT SHOULD BE
SUSTAINED. WE RECOGNIZE THAT THE PASSAGE OF TIME TO THE DATE OF THIS
DECISION MAY HAVE MADE THE NEED FOR RENTAL SPACE MORE CRUCIAL AND
CRITICAL INSOFAR AS THE NAVY IS CONCERNED AND HAS POSSIBLY WORKED TO THE
ECONOMIC DISADVANTAGE OF THE PARTIES TO THIS PROTEST. HOWEVER, WE
BELIEVE THE RECORD SHOWS AN INEQUALITY OF TREATMENT OF THE PARTIES.
UNDER THE CIRCUMSTANCES, WE BELIEVE THAT EITHER GLOPAR SHOULD BE
READMITTED TO THE NEGOTIATIONS
B-172755, MAY 14, 1971
BID PROTEST - BID RESPONSIVENESS
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST PROPOSED AWARD
OF CONTRACT TO LOW BIDDER, JAMES L. FERRY & SON, UNDER AN IFB ISSUED BY
THE CORPS OF ENGINEERS, SACRAMENTO DISTRICT.
ALTHOUGH LOW BIDDER FAILED TO ACKNOWLEDGE RECEIPT OF AN AMENDMENT
WHICH DELETED THE PROVISIONS OF THE DAVIS-BACON ACT FROM THE INVITATION,
THE ONLY EFFECT OF THE AMENDMENT WAS TO REDUCE THE COST OF PERFORMANCE
AND THEREFORE FAILURE TO ACKNOWLEDGE SHOULD BE WAIVED AS A MINOR
INFORMALITY. ALSO, THE INSERTION OF THE WORDS "ENCLOSED IS BID
GUARANTEE, CONSISTING OF BID BOND IN THE AMOUNT OF 20%" CLEARLY
INDICATES OFFEROR'S INTENTION AND A BINDING CONTRACT EXISTS.
TO CARL J. WOODS:
YOUR PROTEST AGAINST ACCEPTANCE OF THE LOW BID OF JAMES L. FERRY &
SON UNDER INVITATION FOR BIDS NO. DACW05-71-B-0068, ISSUED BY THE CORPS
OF ENGINEERS, SACRAMENTO DISTRICT, HAS BEEN REFERRED TO OUR OFFICE BY
THE OFFICE OF THE CHIEF OF ENGINEERS AS REQUESTED.
THE SUBJECT INVITATION WAS ISSUED ON JANUARY 27, 1971, WITH BID
OPENING SCHEDULED ON FEBRUARY 25, 1971. ON FEBRUARY 24, 1971,
TELEGRAPHIC AMENDMENT NO. 1 WAS ISSUED EXTENDING THE BID OPENING UNTIL
MARCH 11, 1971, IN RECOGNITION OF PRESIDENTIAL PROCLAMATION 4031, DATED
FEBRUARY 23, 1971, WHICH SUSPENDED THE PROVISIONS OF THE DAVIS-BACON
ACT, 40 U.S.C. 276A, AS TO ALL CONTRACTS ENTERED INTO ON OR SUBSEQUENT
TO THE DATE THEREOF. ON MARCH 3, 1971, AMENDMENT NO. 2 WAS ISSUED,
DELETING THE DAVIS-BACON ACT PROVISIONS OF THE INVITATION. THE
INVITATION PROVIDED THAT THE FAILURE TO ACKNOWLEDGE ALL AMENDMENTS MAY
CAUSE REJECTION OF THE BID.
BIDS WERE OPENED ON MARCH 11, 1971, AT 2:00 P.M., AND FERRY WAS THE
LOW BIDDER AT $87,625. YOUR BID OF $94,942 WAS SECOND LOW. FERRY'S BID
FAILED TO ACKNOWLEDGE RECEIPT OF AMENDMENT NO. 2. AFTER BIDS WERE
OPENED ON MARCH 11, 1971, FERRY DELIVERED AN ACKNOWLEDGMENT OF THE
RECEIPT OF AMENDMENT NO. 2. NO AWARD HAS BEEN MADE.
IT IS YOUR CONTENTION THAT THE FAILURE OF FERRY'S BID TO INCLUDE
ACKNOWLEDGMENT OF THE RECEIPT OF AMENDMENT NO. 2 RENDERS IT
NONRESPONSIVE AND REQUIRES REJECTION. THE CONTENTION HAS BEEN MADE THAT
FERRY'S BID IS NONRESPONSIVE FOR THE ADDITIONAL REASON THAT THE
ACCOMPANYING BID BOND DID NOT STATE THE PENAL SUM OF THE BOND AS
PROVIDED FOR THEREIN.
THE GENERAL RULE TO THE EFFECT THAT THE FAILURE TO ACKNOWLEDGE AN
AMENDMENT WHICH AFFECTS PRICE REQUIRES REJECTION OF THE BID AS
NONRESPONSIVE IS NOT FOR APPLICATION WHERE, AS HERE, THE ONLY MATERIAL
EFFECT OF THE AMENDMENT IS TO REDUCE THE COST OF PERFORMANCE. SEE
B-171499, MARCH 23, 1971; B-167073, JULY 15, 1969. THIS IS SO BECAUSE,
AS WE SAID IN 41 COMP. GEN. 550, 553 (1962), " *** IF WE ASSUME THAT THE
LOW BIDDER'S FAILURE TO ACKNOWLEDGE THE ADDENDUM WAS DUE TO IGNORANCE OF
ITS EXISTENCE, THEN HIS BID PRICE WOULD NOT REFLECT THE LESSENED
REQUIREMENTS OF THE SPECIFICATIONS AND, THEREFORE, HIS FAILURE TO
ACKNOWLEDGE WOULD ONLY BE PREJUDICIAL TO HIS COMPETITIVE POSITION AND
EVEN POSSIBLY BENEFICIAL TO THE POSITION OF THE OTHER BIDDERS." FURTHER,
IN B-159412, JULY 26, 1966, WE HELD THAT " *** WHERE THE UNACKNOWLEDGED
AMENDMENT MERELY EFFECTS A DECREASE IN THE COST OF PERFORMANCE FAILURE
TO ACKNOWLEDGE IT SHOULD BE WAIVED AS A MINOR INFORMALITY, *** ". SEE
ARMED SERVICES PROCUREMENT REGULATION 2-405. MOREOVER, IN A SITUATION
WHERE THE BIDDER FAILS TO ACKNOWLEDGE AN AMENDMENT HAVING THE EFFECT OF
DECREASING THE COST OF PERFORMANCE, THE BIDDER DOES NOT HAVE THE OPTION
OF REMAINING SILENT AND NOT RECEIVING THE AWARD, SINCE THE GOVERNMENT,
PURSUANT TO ASPR 2-405, MAY WAIVE THE FAILURE TO ACKNOWLEDGE THE
AMENDMENT AND MAKE AWARD ON THE BASIS OF THE BID AS SUBMITTED.
B-165150, SEPTEMBER 16, 1968. THEREFORE, FERRY'S BID SHOULD NOT BE
REJECTED FOR FAILURE TO ACKNOWLEDGE RECEIPT OF AMENDMENT NO. 2.
WITH REGARD TO THE CONTENTION CONCERNING THE DEFICIENCY OF THE BID
BOND, WE NOTE THAT ON THE REVERSE SIDE OF STANDARD FORM 21, BID FORM
(CONSTRUCTION CONTRACT), FERRY INSERTED IN WRITING IN THE SPACES
PROVIDED THEREFOR THAT, "ENCLOSED IS BID GUARANTEE, CONSISTING OF BID
BOND IN THE AMOUNT OF 20%." IN ADDITION, BY LETTER DATED MARCH 12, 1971,
THE SURETY CONFIRMED ITS INTENTION TO BE BOUND ON THE BOND. THESE
CIRCUMSTANCES ARE IDENTICAL TO THOSE CONSIDERED IN OUR DECISION REPORTED
AT 40 COMP. GEN. 314, 316 (1960), WHEREIN WE DETERMINED THE BOND VALID
AND STATED:
"IN THE CIRCUMSTANCES HERE PRESENTED WE BELIEVE THAT THE INTENTION OF
THE PARTIES RESPECTING THE OBLIGATION OF THE SURETY IS SO CLEAR THAT A
BINDING CONTRACT EXISTS. THE EVIDENCE, INCLUDING THE STATEMENT IN THE
BID THAT A BID BOND IN THE AMOUNT OF FIVE PERCENT OF THE BID WAS BEING
SUBMITTED THEREWITH, AND THE FURTHER STATEMENT BY THE SURETY IN ITS
LETTER OF NOVEMBER 3, 1960, THAT IT WAS ITS INTENTION TO BE OBLIGATED IN
THE INDICATED AMOUNT OF FIVE PERCENT OF THE BID, CLEARLY SHOWS THE
INTENTIONS OF THE PARTIES IN THE MATTER." SEE, ALSO, B-125045, JULY 30,
1970.
ACCORDINGLY, WE CONCLUDE THAT NEITHER OF THE CONTENTIONS RAISED
JUSTIFY THE REJECTION OF THE JAMES L. FERRY & SON BID AS NONRESPONSIVE.
B-171202, MAY 13, 1971
REDUCTION IN GRADE - SALARY RATE
AFFIRMING PRIOR DECISION WHICH FOUND NO BASIS FOR CONCLUDING THAT
CLAIMANT'S SALARY - $9,308 A YEAR - SHOULD HAVE BEEN SET AT A HIGHER
RATE INCIDENT TO ASSIGNMENT AS A CLAIMS REPRESENTATIVE WITH THE SOCIAL
SECURITY ADMINISTRATION.
ALTHOUGH CLAIMANT WAS NOT INFORMED THAT HER SALARY WOULD BE REDUCED
UNTIL AFTER ARRANGEMENTS WERE MADE TO MOVE TO A NEW DUTY STATION AND SHE
ACCEPTED THE NEW RATE UNDER PROTEST, THE KANSAS CITY REGIONAL OFFICE HAS
REFUSED TO SET THE NEW SALARY UNDER THE HIGHEST PREVIOUS RATE RULE IN
ACCORDANCE WITH THEIR ADMINISTRATIVE PROCEDURES, AND THAT DECISION IS
DISPOSITIVE.
TO MISS FLOSSIE M. PREWETT:
WE REFER FURTHER TO YOUR LETTER OF MARCH 16, 1971, CONCERNING THE
DECISION TO YOU OF MARCH 2, 1971, WHICH NOTED THAT WE FOUND NO BASIS FOR
CONCLUDING THAT YOUR SALARY - $9,308 A YEAR - SHOULD HAVE BEEN SET AT A
HIGHER RATE ON NOVEMBER 8, 1968, UPON YOUR REDUCTION IN GRADE FROM GS-10
TO GS-9, EFFECTIVE NOVEMBER 17, 1968.
YOUR LETTER OF MARCH 16, 1971, DOES NOT CONTAIN ANY INFORMATION WHICH
WAS NOT PART OF THE RECORD WHEN THE ABOVE DECISION WAS REACHED ON MARCH
2, 1971.
AS STATED IN OUR LETTER, YOU FILED A SOCIAL SECURITY ADMINISTRATION
FORM ON SEPTEMBER 20, 1968, SHOWING YOUR AVAILABILITY FOR ASSIGNMENT AS
CLAIMS REPRESENTATIVE, GS-9, $9,917, IN ST. LOUIS, MISSOURI. YOU STATE
YOU DID THIS SINCE YOU WERE ADVISED THAT SUCH A VACANCY EXISTED THERE.
FURTHER, YOU STATE YOUR OFFICE ABOUT OCTOBER 15 WAS ADVISED - APPARENTLY
BY TELEPHONE - THAT YOUR REQUEST FOR TRANSFER HAD BEEN ACCEPTED AND YOU
WERE TO REPORT TO THE ST. LOUIS DISTRICT OFFICE ON NOVEMBER 18, 1968.
SINCE NO CHANGES IN CONDITIONS WERE INDICATED FROM THOSE STATED ON THE
REQUEST FOR TRANSFER, YOU MADE ARRANGEMENTS TO TRANSFER TO ST. LOUIS
INCLUDING VACATING YOUR APARTMENT, SELLING PART OF YOUR FURNITURE, AND
PREPARING THE REMAINDER FOR SHIPMENT.
ON OCTOBER 28, 1968, YOU STATE YOU WERE FOR THE FIRST TIME INFORMED
THAT YOUR SALARY WOULD BE REDUCED TO $9,308 A YEAR AND THE EXPLANATION
GIVEN FOR NOT NOTIFYING YOU SOONER WAS THAT THE FORM YOU FILED ON
SEPTEMBER 20, 1968, HAD BEEN OVERLOOKED BY THE KANSAS CITY REGIONAL
OFFICE. SINCE YOU HAD MADE ARRANGEMENTS TO MOVE, YOU STATE THAT YOU
SIGNED THE ACCEPTANCE OF THE $9,308 ANNUAL RATE UNDER PROTEST.
AS STATED IN OUR LETTER OF MARCH 2, 1971, THE CIVIL SERVICE
COMMISSION DENIED YOU SALARY RETENTION SINCE YOU DID NOT MEET THE
REQUIREMENT FOR SALARY RETENTION AS REQUIRED BY 5 U.S.C. 5337.
ADDITIONALLY, WE ADVISED YOU OF OUR INQUIRY TO THE DEPARTMENT OF
HEALTH, EDUCATION, AND WELFARE CONCERNING SETTING YOUR SALARY UNDER THE
HIGHEST PREVIOUS RATE RULE - A RULE SEPARATE AND APART FROM SALARY
RETENTION FOR 2 YEARS UNDER 5 U.S.C. 5337. AS REPORTED TO US YOUR
SALARY WAS SET IN ACCORDANCE WITH ADMINISTRATIVE POLICY WHICH PROVIDES
FOR GS-10 EMPLOYEES WHO APPLY FOR THE GS-9 POSITIONS INVOLVED THAT
UNLESS AN EMPLOYEE HAS BEEN IN THE GS-10 POSITION FOR A YEAR THE SALARY
IN THE GS-9 POSITION WOULD BE SET AT THE STEP HELD IN GS-9 PRIOR TO
PROMOTION TO GS-10.
THE CIRCUMSTANCES YOU RELATE DESCRIBING THE EVENTS LEADING TO YOUR
TRANSFER AND REDUCTION IN GRADE DO NOT PROVIDE A BASIS FOR DETERMINING
THAT YOUR SALARY RATE SHOULD BE SET AT $9,917 A YEAR. ACCORDINGLY, WE
CAN ONLY AFFIRM THE DECISION OF MARCH 2, 1971.
B-171233, MAY 13, 1971
BID PROTEST - LATE BID - BID RESPONSIVENESS
DECISION DENYING PROTEST AGAINST AWARD OF A SALES CONTRACT TO U.S.
GEAR EQUIPMENT COMPANY FOR A USED ROTARY SURFACE GRINDER ISSUED BY
MENASCO MANUFACTURING COMPANY, A GOVERNMENT CONTRACTOR.
BECAUSE THE CONTRACTOR'S POST OFFICE BOX WAS NOT CHECKED ON BID
OPENING DAY AT A TIME REASONABLY CLOSE TO THE LATEST TIME BY WHICH BIDS
COULD HAVE BEEN DELIVERED TO THE BID OPENING ROOM, IT WAS PROPER TO
CONSIDER GEAR'S BID AS TIMELY. ALSO, IT WOULD ADVERSELY AFFECT THE
INTEGRITY OF THE COMPETITIVE BID SYSTEM TO REJECT GEAR'S BID AS
NONRESPONSIVE BECAUSE THEY CLOSED THE ACCOUNT ON WHICH ITS BID DEPOSIT
CHECK WAS DRAWN. HOWEVER, THE COMP. GEN. HAS INFORMED THE DSA THAT IF
SUCCESSFUL BIDDER DOES NOT PERFORM, THE AWARD SHOULD BE CANCELLED AND
THE ITEMS READVERTISED.
TO AKIN, VIAL, HAMILTON, KOCH & TUBB:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 23, 1971, CONCERNING THE
PROTEST BY PRODUCT DESIGN & MANUFACTURING COMPANY (PRODUCT DESIGN)
AGAINST THE SALE TO U.S. GEAR EQUIPMENT COMPANY (U.S. GEAR) OF A USED
ROTARY SURFACE GRINDER UNDER ITEM NO. 1 OF SALE NO. 40 AT THE MENASCO
MANUFACTURING COMPANY (MENASCO), FORT WORTH, TEXAS.
THE SALES INVITATION, ISSUED AUGUST 12, 1970, OFFERED FOUR ITEMS OF
GOVERNMENT-OWNED INDUSTRIAL PLANT EQUIPMENT UNDER A CONTRACTOR CONDUCTED
SALE. BIDS WERE OPENED AS SCHEDULED AT 2:00 P.M., AUGUST 28, 1970.
ON AUGUST 31, 1970, AT 11:00 A.M., A SEALED BID FROM U.S. GEAR WAS
PICKED UP AT THE RIVERSIDE STATION POST-OFFICE BOX DESIGNATED IN THE
SALES INVITATION AND DELIVERED TO THE PLANT CLEARANCE OFFICER AT
MENASCO. AFTER A PRELIMINARY EXAMINATION, MENASCO BY LETTER DATED
SEPTEMBER 4, 1970, ADVISED U.S. GEAR THAT ITS BID WAS RECEIVED LATE AND
THEREFORE WAS CONSIDERED NONRESPONSIVE. U.S. GEAR PROTESTED, ALLEGING
THAT ITS BID WAS DELIVERED TO MENASCO IN AMPLE TIME TO BE CONSIDERED.
DOCUMENTATION WAS FURNISHED THE FORT WORTH POST OFFICE SHOWING THAT THE
LETTER SENT AIRMAIL-SPECIAL DELIVERY WAS METER STAMPED BY THE FORT WORTH
MAIN POST OFFICE, "RECEIVED AUGUST 28, 11:00 A.M."
BY LETTER DATED SEPTEMBER 23, 1970, THE FORT WORTH POSTMASTER ADVISED
THAT ALL SPECIAL DELIVERY MAIL IS DATED AND TIMED AT THE MAIN POST
OFFICE BY A BACK STAMP AT THE TIME OF RECEIPT AND A LETTER BACK-STAMPED
AT 11:00 A.M. WOULD HAVE BEEN DISPATCHED TO RIVERSIDE STATION AT 12 NOON
THE SAME DAY.
THE RECORD ALSO DISCLOSES THAT THE LAST PICK-UP MADE BY MENASCO FROM
ITS POST OFFICE BOX AT THE RIVERSIDE STATION PRIOR TO BID OPENING WAS AT
11:00 A.M.
PARAGRAPH 2 OF THE SALES INVITATION SET FORTH THE FOLLOWING
INSTRUCTIONS TO BIDDERS:
"MAILED BIDS MUST BE MAILED IN TIME TO BE IN POSSESSION OF THE
'CONTRACTOR' BY THE DATE AND HOUR OF BID OPENING. A LATE MAILED BID
WILL BE CONSIDERED ONLY IF RECEIVED BEFORE AWARD AND SUCH BID WAS MAILED
BY REGISTERED MAIL OR BY CERTIFIED MAIL FOR WHICH AN OFFICIAL POST
OFFICE STAMP (POST MARK) ON THE ORIGINAL RECEIPT FOR CERTIFIED OR
REGISTERED MAIL HAS BEEN OBTAINED AND IT IS DETERMINED THAT EITHER THE
LATENESS WAS DUE SOLELY TO A DELAY IN MAILS FOR WHICH THE BIDDER WAS NOT
RESPONSIBLE OR THE BID WAS RECEIVED AT THE SALES OFFICE IN SUFFICIENT
TIME TO BE RECEIVED BY THE 'CONTRACTOR' IN TIME FOR OPENING AND EXCEPT
FOR DELAY DUE TO MISHANDLING ON THE PART OF THE 'CONTRACTOR' AT THE
SALES OFFICE, WOULD HAVE BEEN ON TIME. BIDDERS USING CERTIFIED MAIL ARE
CAUTIONED TO OBTAIN A RECEIPT FOR CERTIFIED MAIL SHOWING A LEGIBLE,
DATED POSTMARK AND TO RETAIN SUCH RECEIPT AGAINST THE CHANCE THAT IT
WILL BE REQUIRED AS EVIDENCE THAT A LATE BID WAS TIMELY MAILED."
IN VIEW OF THE QUOTED LANGUAGE AND THE INFORMATION FROM THE POST
OFFICE, IT WAS DETERMINED THAT THE BID OF U.S. GEAR WAS TIMELY.
AUTHORITY FOR AWARDS WAS ISSUED ON OCTOBER 6, 1970. SUCCESSFUL BIDDERS
WERE NOTIFIED OF AWARD BY MENASCO AND BID DEPOSITS OF UNSUCCESSFUL
BIDDERS WERE RETURNED. SUCCESSFUL BIDDERS' CHECKS WERE DEPOSITED BY
MENASCO ON OCTOBER 12, 1970, INCLUDING A COMPANY CHECK DRAWN BY U.S.
GEAR IN THE AMOUNT OF $5,000. ON OCTOBER 19, 1970, MENASCO'S BANK
ADVISED THAT THE U.S. GEAR COMPANY CHECK HAD BEEN RETURNED TO THEM
MARKED "ACCOUNT CLOSED."
PRODUCTS DESIGN AND MANUFACTURING COMPANY, THE SECOND HIGH BIDDER FOR
ITEM 1, PROTESTS THE AWARD TO U.S. GEAR ON THE BASES THAT THE BID
ARRIVED TOO LATE TO BE CONSIDERED AND THAT THE SUBSEQUENT CLOSING OF ITS
BANK ACCOUNT RENDERED U.S. GEAR'S BID NONRESPONSIVE.
IN THE INTERESTS OF OBTAINING COMPETITION WE BELIEVE THAT MENASCO'S
POST OFFICE BOX SHOULD HAVE BEEN CHECKED ON BID OPENING DAY AT A TIME
REASONABLY CLOSE TO THE LATEST TIME BY WHICH BIDS COULD HAVE BEEN
DELIVERED FROM THE POST OFFICE BOX TO THE BID OPENING ROOM. IT IS NOT
CLEAR WHETHER THE BID WAS DISPATCHED FROM THE MAIN POST OFFICE IN FORT
WORTH TO RIVERSIDE AT NOON OR WHETHER IT WAS RECEIVED AT RIVERSIDE AT
NOON. EVEN ASSUMING THE FORMER, SINCE THE DISTANCE BETWEEN THE TWO
LOCATIONS IS ONLY 30 CITY BLOCKS, WE BELIEVE IT IS REASONABLE TO
CONCLUDE THAT THE BID WAS RECEIVED AT RIVERSIDE AT NOON OR WITHIN A
SHORT TIME THEREAFTER. IN EITHER CASE, MAIL COULD READILY HAVE BEEN
PICKED UP WELL AFTER THAT TIME AND STILL HAVE BEEN DEPOSITED IN THE BID
OPENING ROOM AT 2:00 P.M. WE, THEREFORE, FIND NO BASIS TO DISAGREE WITH
THE ADMINISTRATIVE POSITION THAT THE U.S. GEAR BID SHOULD HAVE BEEN
CONSIDERED FOR AWARD WITHIN THE QUOTED PROVISIONS OF THE SOLICITATION.
WE THINK THE PRIMARY ISSUE TO BE RESOLVED HERE IS THE ACCEPTABILITY
OF THE U.S. GEAR BID IN LIGHT OF THE FAILURE OF THE BID DEPOSIT CHECK TO
CLEAR. THE RECORD DOES NOT SHOW THE EXACT DATE ON WHICH U.S. GEAR
CLOSED THE ACCOUNT IN QUESTION. IN ANY CASE, THE ACCEPTANCE OF THE U.S.
GEAR OFFER TO PURCHASE THE PROPERTY INVOLVED AT THE PRICE STATED
RESULTED IN A VALID AND BINDING CONTRACT, AND AT THAT TIME THE RIGHTS
AND LIABILITIES OF THE PARTIES BECAME FIXED. TO PERMIT A BIDDER TO HAVE
HIS BID REJECTED AFTER ALL BIDS HAVE BEEN EXPOSED BY THE SIMPLE
EXPEDIENT OF CLOSING THE ACCOUNT ON WHICH HIS BID DEPOSIT CHECK WAS
DRAWN, WOULD ADVERSELY AFFECT THE INTEGRITY OF THE COMPETITIVE BID
SYSTEM. IT HAS LONG BEEN RECOGNIZED THAT THE SYSTEM'S INTEGRITY CAN BE
MAINTAINED ONLY IF BIDS ARE SET AS OF BID OPENING AND MAY NOT BE AMENDED
OR WITHDRAWN THEREAFTER FOR THE PERIOD SET. SEE 27 COMP. GEN. 436
(1948), B-133796, DECEMBER 4, 1957.
THEREFORE, WE HAVE ADVISED THE DEFENSE SUPPLY AGENCY THAT IF U.S.
GEAR HAS NOT PERFORMED IN ACCORDANCE WITH THE TERMS OF THE AWARD AFTER A
REASONABLE OPPORTUNITY TO DO SO, THE AWARD SHOULD BE CANCELLED AND ITEMS
1 AND 2 SHOULD BE READVERTISED FOR SALE.
B-171677, MAY 13, 1971
REVISION TO JTR - SHIPMENT OF PROFESSIONAL BOOKS AND PAPERS
ADVISING THAT THE COMP. GEN. WOULD OFFER NO OBJECTION TO THE PROPOSED
REVISION OF THE JTR TO PERMIT SHIPMENT OF PROFESSIONAL BOOKS AND PAPERS
IN EXCESS OF THE MAXIMUM WEIGHT OF HOUSEHOLD GOODS ALLOWED PROVIDED THE
COST OF SUCH SHIPMENT IS REGARDED AS AN APPROPRIATE ADMINISTRATIVE
EXPENSE SUPPORTED BY CERTIFICATION THAT SHIPMENT IS NECESSARY IN LIEU OF
PURCHASE OF SIMILAR ITEMS REQUIRED FOR THE EMPLOYEE'S OFFICIAL USE.
TO MR. SECRETARY:
REFERENCE IS MADE TO LETTER DATED DECEMBER 28, 1970, FROM MR. DONALD
W. SRULL, ACTING ASSISTANT SECRETARY OF THE ARMY (MANPOWER AND RESERVE
AFFAIRS), REQUESTING AN ADVANCE DECISION ON A RECOMMENDED REVISION OF
JOINT TRAVEL REGULATIONS, VOLUME 2, TO PROVIDE FOR THE TRANSPORTATION AT
GOVERNMENT EXPENSE OF PERSONALLY OWNED PROFESSIONAL BOOKS, PAPERS, AND
EQUIPMENT OF AN EMPLOYEE AS A SEPARATE WEIGHT ALLOWANCE IN ADDITION TO
THE MAXIMUM SHIPMENT OF HOUSEHOLD EFFECTS UNDER CIRCUMSTANCES AS
HEREINAFTER RELATED. THIS REQUEST WAS ASSIGNED PDTATAC CONTROL NO.
70-59 BY THE PER DIEM, TRAVEL AND TRANSPORTATION ALLOWANCE COMMITTEE.
AS IS INDICATED IN THE LETTER, 5 U.S.C. 5724 PROVIDES FOR A WEIGHT
ALLOWANCE OF HOUSEHOLD GOODS AND PERSONAL EFFECTS NOT IN EXCESS OF
11,000 POUNDS. THE LETTER CITES OUR DECISION, B-145712, MAY 26, 1961,
IN WHICH WE HELD THERE IS NO STATUTORY AUTHORITY TO TRANSPORT PERSONALLY
OWNED PROFESSIONAL BOOKS AND PAPERS IN ADDITION TO THE MAXIMUM WEIGHT OF
HOUSEHOLD GOODS ALLOWED.
IT IS STATED THERE ARE INSTANCES WHEN THE WEIGHT OF ACTUAL HOUSEHOLD
GOODS TO BE SHIPPED PRECLUDES THE SHIPMENT OF PERSONALLY OWNED
PROFESSIONAL BOOKS, PAPERS, AND EQUIPMENT. IN MANY CASES IT IS SAID
THAT THE PERSONALLY OWNED PROFESSIONAL BOOKS, PAPERS, AND EQUIPMENT ARE
NECESSARY TO THE PROPER PERFORMANCE OF THE DUTIES ASSIGNED TO AN
EMPLOYEE AT HIS NEW DUTY STATION. ACCORDINGLY, SUCH BOOKS AND EQUIPMENT
MUST BE OBTAINED AT GOVERNMENT EXPENSE FOR THE EMPLOYEE'S USE. A
DECISION IS THEREFORE REQUESTED AS TO WHETHER UNDER THESE CIRCUMSTANCES
OUR OFFICE WOULD BE REQUIRED TO OBJECT TO THE TRANSPORTATION OF THE
EMPLOYEE'S PERSONALLY OWNED PROFESSIONAL BOOKS, PAPERS, AND EQUIPMENT AT
GOVERNMENT EXPENSE. ALSO, IF THERE IS NO OBJECTION TO THE REVISION
PROPOSED, A FURTHER QUESTION IS ASKED AS TO WHETHER THESE ARTICLES MAY
BE TRANSPORTED AS AN ADMINISTRATIVE EXPENSE OF AN AGENCY IN LIEU OF
SHIPMENT AS AN ALLOWANCE OF THE EMPLOYEE.
WE WOULD OFFER NO OBJECTION TO A REGULATION ALONG THE LINE PROPOSED,
PROVIDED THERE BE INCLUDED THEREIN A REQUIREMENT THAT ANY SHIPMENT OF
SUCH BOOKS AND EQUIPMENT BE SUPPORTED BY AN ADMINISTRATIVE CERTIFICATION
THAT SHIPMENT IS NECESSARY IN LIEU OF PURCHASE OF SIMILAR ITEMS REQUIRED
FOR THE EMPLOYEE'S OFFICIAL USE. THE COST OF SUCH A SHIPMENT SHOULD BE
REGARDED AS AN APPROPRIATE ADMINISTRATIVE EXPENSE.
B-171713(1), MAY 13, 1971
BID PROTEST - FINAL OFFER - NONRECEIPT
DECISION DENYING PROTEST OF ZERO MANUFACTURING COMPANY AGAINST AWARD
OF CONTRACT TO F. & B. MANUFACTURING COMPANY UNDER AN RFP ISSUED BY THE
NAVAL ORDNANCE STATION, LOUISVILLE, KY., FOR A QUANTITY OF CONTAINERS.
WHEN OFFERORS WERE REQUESTED TO SUBMIT BEST AND FINAL OFFERS PRIOR TO
CLOSE OF BUSINESS ON DECEMBER 21, 1970, PROTESTANT'S TWX WAS SENT TO
FORT MACARTHUR UNDER THE ERRONEOUS ASSUMPTION THAT IT WOULD BE FORWARDED
TO THE CONTRACTING OFFICER. HOWEVER, THERE IS NO BASIS TO DISTURB THE
AWARD TO B. & F., SINCE THE CONTRACTING OFFICER WAS ACTING IN GOOD FAITH
AND WITHOUT NOTICE OF THE CIRCUMSTANCES SURROUNDING THE SUBMISSION OF
PROTESTANT'S TWX.
TO ZERO MANUFACTURING CO.:
WE REFER TO YOUR LETTER OF JANUARY 18, 1971, AND SUBSEQUENT
CORRESPONDENCE, PROTESTING AGAINST THE AWARD OF A CONTRACT TO F. & B.
MANUFACTURING COMPANY UNDER REQUEST FOR PROPOSALS N00197-71-R-0007
ISSUED BY THE NAVAL ORDNANCE STATION, LOUISVILLE, KENTUCKY.
THE ADMINISTRATIVE REPORT FURNISHED OUR OFFICE BY THE DEPUTY
COMMANDER, PURCHASING, NAVAL SUPPLY SYSTEMS COMMAND, BY LETTER OF
FEBRUARY 19, 1971, WITH ENCLOSURES, CONTAINS THE FOLLOWING FACTS
PERTINENT TO YOUR PROTEST. THE SUBJECT REQUEST FOR PROPOSALS WAS ISSUED
ON NOVEMBER 6, 1970, AND REQUESTED OFFERS FOR FURNISHING A QUANTITY OF
360 MK 372 MOD 6 CONTAINERS. SIX OFFERORS RESPONDED; AFTER EVALUATION,
THE CONTRACTING OFFICER BY MESSAGES DATED DECEMBER 16, 1970, REQUESTED
BEST AND FINAL OFFERS FROM EACH FIRM PRIOR TO THE CLOSE OF BUSINESS ON
DECEMBER 21, 1970. WITH THE EXCEPTION OF YOUR FIRM AND ANOTHER OFFEROR,
ALL SOURCES SUBMITTED TIMELY RESPONSES. SUBSEQUENTLY, A CONTRACT WAS
AWARDED TO F. & B. MANUFACTURING COMPANY ON JANUARY 12, 1971, AS THE LOW
RESPONSIBLE OFFEROR. BY LETTER DATED JANUARY 12, 1971, ALL UNSUCCESSFUL
OFFERORS WERE NOTIFIED OF THE CONTRACT AWARD.
ON JANUARY 13, 1971, A REPRESENTATIVE OF YOUR FIRM CONTACTED THE
CONTRACTING AGENCY TO DETERMINE THE STATUS OF PROPOSAL EVALUATION AND HE
WAS ADVISED OF THE CONTRACT AWARD. AT THIS TIME, THE CONTRACTING AGENCY
WAS FIRST ADVISED THAT YOUR FIRM HAD SUBMITTED A TWX ON THE MORNING OF
DECEMBER 21 WHICH, IF IT HAD BEEN RECEIVED, WOULD HAVE MADE YOUR FIRM
THE LOW OFFEROR. SPECIFICALLY, YOU ADVISE IN YOUR LETTER OF JANUARY 18,
1971, THAT THE CONTRACTING OFFICER'S TWX WAS RECEIVED FROM NO.
213-548-0913, WHICH IS THE NUMBER OF FORT MACARTHUR, SAN PEDRO,
CALIFORNIA, AND THAT YOU RESPONDED TO THIS NUMBER, ASSUMING THAT THE
MESSAGE WOULD BE FORWARDED TO THE CONTRACTING OFFICER. HOWEVER, IT
APPEARS THAT WHILE FORT MACARTHUR RELAYS MESSAGES RECEIVED FROM MILITARY
INSTALLATIONS, IT DOES NOT ACCEPT MESSAGES FROM COMMERCIAL COMPANIES.
IN THIS CONNECTION, WE NOTE THAT THERE IS NO CONCLUSIVE EVIDENCE THAT
YOUR TWX WAS EVER RECEIVED BY FORT MACARTHUR, AS IS EVIDENCED BY YOUR
SUBSEQUENT ATTEMPTS TO VERIFY RECEIPT.
ASSUMING, AS YOU CONTEND, THAT YOU WERE MISLED, NO BASIS IS PRESENTED
FOR OUR OFFICE TO DISTURB THE AWARD OF CONTRACT TO F. & B. MANUFACTURING
COMPANY, SINCE THE CONTRACTING OFFICER WAS ACTING IN GOOD FAITH AND
WITHOUT NOTICE OF THE CIRCUMSTANCES SURROUNDING THE SUBMISSION OF YOUR
TWX. IN THIS REGARD, YOU WILL NOTE FROM AN EXAMINATION OF THE CLAUSE,
ENTITLED "LATE OFFERS AND MODIFICATIONS OR WITHDRAWALS (1968,
DECEMBER)," INCLUDED IN THE REQUEST FOR PROPOSALS, ONE OF THE ESSENTIAL
CONDITIONS THAT MUST BE MET BEFORE A LATE MODIFICATION MAY BE CONSIDERED
IS THAT IT BE RECEIVED BEFORE AN AWARD IS MADE. SEE, ALSO, ASPR
2-303.2; CF. B-169728, JULY 17, 1970. WE ARE, HOWEVER, BRINGING THE
FOREGOING MATTERS TO THE ATTENTION OF THE SECRETARY OF THE NAVY FOR
APPROPRIATE ACTION.
B-171713(2), MAY 13, 1971
BID PROTEST - FINAL OFFER - NONRECEIPT
IN CONNECTION WITH THE PROTEST OF ZERO MANUFACTURING COMPANY AGAINST
AN AWARD MADE UNDER AN RFP ISSUED FOR CONTAINERS, THE COMP. GEN. ADVISES
THAT THE NAVAL ORDNANCE STATION'S MESSAGE TRANSMISSION PROCEDURES BE
REVISED TO MAKE CLEAR THAT TWX'S CANNOT BE RECEIVED.
TO MR. SECRETARY:
ENCLOSED IS A COPY OF OUR DECISION OF TODAY, DENYING THE PROTEST OF
ZERO MANUFACTURING COMPANY AGAINST THE AWARD OF A CONTRACT TO F. & B.
MANUFACTURING COMPANY UNDER REQUEST FOR PROPOSALS N00197-71-R-0007,
ISSUED BY THE NAVAL ORDNANCE STATION, LOUISVILLE, KENTUCKY. WHILE WE
HAVE DENIED THE PROTEST, WE BELIEVE THAT THE NAVAL ORDNANCE STATION'S
MESSAGE TRANSMISSION PROCEDURES SHOULD BE REVIEWED AND REVISED TO
ELIMINATE THE POSSIBILITY THAT THE CIRCUMSTANCES PROMPTING THE PROTEST
WILL RECUR IN THE FUTURE. IN THIS CONNECTION, IT IS OUR VIEW THAT IF
TWX'S ARE GOING TO BE UTILIZED BY THE NAVAL ORDNANCE STATION IN THE
CONDUCT OF NEGOTIATIONS, OFFERORS SHOULD BE ADVISED THAT TWX RESPONSES
CANNOT BE RECEIVED. WE WOULD APPRECIATE YOUR ADVICE AS TO THE REMEDIAL
ACTION TAKEN.
THE PROTEST WAS THE SUBJECT OF A LETTER, WITH ENCLOSURES, OF FEBRUARY
19, 1971, FROM THE DEPUTY COMMANDER, PURCHASING, NAVAL SUPPLY SYSTEMS
COMMAND, FURNISHING OUR OFFICE AN ADMINISTRATIVE REPORT.
B-171935, MAY 13, 1971
CIVILIAN EMPLOYEE - OVERPAYMENT OF PAY - WAIVER
DENYING CLAIM OF MARION L. SNIDER FOR WAIVER OF CLAIM OF U.S. FOR
RECOVERY OF $946 ERRONEOUSLY PAID SINCE CLAIMANT WAS NOT FREE FROM FAULT
AS REQUIRED UNDER PROVISIONS OF 5 U.S.C. 5584 WHICH ALLOWS WAIVER IN
CERTAIN CASES.
WHEN MR. SNIDER'S RURAL MAIL CARRYING ROUTE WAS REDUCED FROM 88 TO 78
MILES (MEANING THAT HIS ANNUAL SALARY WAS REDUCED FROM $6481 TO $6231)
AS THE RESULT OF THE CANCELLATION OF A DETOUR WHEN A NEW BRIDGE WAS
OPENED, HE WAS OBLIGATED TO QUESTION AT THAT TIME THE CONTINUATION OF
HIS OLD SALARY AND MILEAGE RATE.
TO MR. MARION L. SNIDER:
WE REFER FURTHER TO YOUR LETTER OF JANUARY 22, 1971, WHEREIN YOU SEEK
RECONSIDERATION OF THE DENIAL OF YOUR REQUEST FOR WAIVER OF THE CLAIM OF
THE UNITED STATES FOR RECOVERY FROM YOU OF $946.02 ERRONEOUSLY PAID.
YOU REQUEST WAIVER CONSIDERATION UNDER THE PROVISIONS OF 5 U.S.C. 5584
AS ADDED BY PUBLIC LAW 90-616, APPROVED OCTOBER 21, 1968.
THE REQUEST WAS DENIED IN OUR CLAIMS DIVISION LETTER OF DECEMBER 4,
1970, TO THE DIRECTOR, POSTAL DATA CENTER IN ATLANTA, GEORGIA. YOU HAVE
ENCLOSED A COPY OF THE DIRECTOR'S LETTER OF DECEMBER 17, 1970, TO YOU
SETTING FORTH THE REASONS FOR THE DENIAL OF YOUR REQUEST. AS POINTED
OUT IN THOSE LETTERS, YOU WERE OVERPAID FOR THE PERIOD APRIL 1, 1967,
THROUGH NOVEMBER 15, 1968, FOR PAY IN THE GROSS AMOUNT OF $408.42 AND
FOR EQUIPMENT ALLOWANCE IN THE GROSS AMOUNT OF $537.60, A TOTAL OF
$946.02. A COPY OF YOUR OFFICIAL RURAL ROUTE DESCRIPTION, POD FORM
4003, APPROVED ON APRIL 3, 1967, WITH AN EFFECTIVE DATE OF APRIL 1,
1967, SHOWS THAT THE LENGTH OF YOUR RURAL ROUTE WAS REDUCED FROM 88 TO
78 MILES AND THAT YOUR ANNUAL SALARY WAS REDUCED FROM $6,481 TO $6,231.
THE REDUCTION IN ROUTE AS NOTED ON POD FORM 4003 WAS CAUSED BY THE
CANCELLATION OF A DETOUR DUE TO A BRIDGE BEING OPENED TO THE PUBLIC AS
OF APRIL 1, 1967. THE RECORD SHOWS THAT A COPY OF THE POD FORM 4003
ADVISING OF THIS REDUCTION IN SALARY AND MILEAGE WAS GIVEN TO YOU.
HOWEVER, THE ORIGINAL WAS INADVERTENTLY FILED IN YOUR PAYROLL AUDIT
FOLDER WITHOUT BEING PROCESSED TO YOUR MASTER PAYROLL RECORD WITH THE
RESULT THAT BOTH YOUR MILEAGE PAYMENT AND YOUR ANNUAL SALARY WERE
ERRONEOUSLY CONTINUED WITHOUT CHANGE.
WITH RESPECT TO THE OVERPAYMENT OF $537.60 FOR EQUIPMENT MAINTENANCE
BASED ON YOUR MILEAGE, AS SET FORTH IN THE DISALLOWANCE LETTERS, THERE
IS NO PROPER BASIS FOR WAIVER CONSIDERATION SINCE EQUIPMENT MAINTENANCE
IS NOT CONSIDERED PAY UNDER THE PROVISIONS OF 5 U.S.C. 5584.
ACCORDINGLY, YOUR REQUEST FOR RECONSIDERATION CAN ONLY APPLY TO THE
OVERPAYMENT OF PAY IN THE AMOUNT OF $408.42.
CONCERNING THE OVERPAYMENT OF PAY, YOU DISAGREE WITH THE CONCLUSION
THAT YOU SHOULD REASONABLY HAVE BEEN AWARE OF THE ERROR. YOU STATE THAT
YOU WERE TRANSFERRED FROM THE VETERANS ADMINISTRATION TO YOUR POSITION
OF RURAL CARRIER ON AUGUST 13, 1966, WITH A SALARY RATE OF $6,306 PER
ANNUM. THEREAFTER, YOU STATE YOU HAD NINE SALARY CHANGES BETWEEN AUGUST
13, 1966, AND AUGUST 10, 1968. SPECIFICALLY, YOU IDENTIFY A SALARY
CHANGE NOTICE OF $6,657 EFFECTIVE AUGUST 12, 1967, AS WELL AS ON THE
SAME DATE A CHANGE NOTICE TO $6,407, AND A CHANGE NOTICE TO $6,988
EFFECTIVE OCTOBER 7, 1967. YOU URGE THAT WITH SUCH CHANGES CONTINUING TO
AUGUST 10, 1968, YOU HAD NO WAY OF KNOWING THAT YOU WERE BEING OVERPAID.
ADDITIONALLY, YOU STATE YOU VISITED THE POSTAL REGION AT ATLANTA TO
REQUEST ADVICE ON THE CORRECTNESS OF YOUR SALARY. YOU STATE THAT A MRS.
CLAIR NASH OF THE PERSONNEL DIVISION DISCUSSED THE MATTER WITH YOU AND
SCREENED YOUR FILE BUT FOUND NO ERROR AT THAT TIME.
THE SEVERAL CHANGES IN SALARY RATE WHICH YOU MENTION AS WELL AS THE
INDICATION OF YOUR VISIT TO THE REGIONAL OFFICE WERE PART OF THE RECORD
AT THE TIME OF OUR LETTER OF DECEMBER 4, 1970. WE NOTE THAT FROM APRIL
1, 1967, WHEN THE PAYMENT CHANGES SHOULD HAVE BEEN EFFECTED TO ACCORD
WITH THE REDUCTION IN YOUR ROUTE FROM 88 TO 78 MILES, UNTIL AUGUST 12,
1967, THAT NO OTHER CHANGES IN RATE OCCURRED, AND THAT DURING THIS TIME
IN ADDITION TO HAVING A COPY OF POD FORM 4003 REDUCING THE LENGTH OF
YOUR ROUTE, YOU WOULD HAVE BEEN DRIVING THE SHORTER ROUTE AND USING THE
BRIDGE. IN SUCH CIRCUMSTANCES IT WAS INCUMBENT UPON YOU TO QUESTION AT
THAT TIME THE CONTINUATION OF YOUR OLD SALARY RATE AND MILEAGE PAYMENT.
THE ERROR IN YOUR RECORDS WAS NOT DISCOVERED UNTIL THE LOCAL POSTMASTER
AT MITCHELL, GEORGIA, MADE INQUIRY TO THE POSTAL DATA CENTER ON NOVEMBER
21, 1968, CONCERNING THE RATE OF MILEAGE YOU WERE BEING PAID BECAUSE YOU
BELIEVED THERE WAS AN ERROR. THERE IS NO OTHER OFFICIAL RECORD OF YOUR
HAVING QUESTIONED THE ACCURACY OF THE PAYMENTS.
IN VIEW OF YOUR OBLIGATION TO MAKE PROMPT INQUIRY CONCERNING THE
CORRECTNESS OF YOUR PAY FOR PERIODS AFTER APRIL 1, 1967, IT CANNOT BE
SAID THAT YOU WERE WITHOUT FAULT IN THE MATTER SO AS TO BE ENTITLED TO
WAIVER OF THE ERRONEOUS PAYMENTS UNDER THE AUTHORITY OF 5 U.S.C. 5584.
THE PREVIOUS ACTION DENYING YOUR CLAIM IS THEREFORE SUSTAINED.
B-171996, MAY 13, 1971
MILITARY PERSONNEL - TRAVEL ALLOWANCES - MODE OF TRANSPORTATION
DENYING CLAIM OF CAPT. RALPH A. MILTON FOR CREDIT FOR ADDITIONAL
TRAVEL TIME FOR TRAVEL FROM CAMP PENDLETON, CALIF., TO CAMP LEJEUNE,
NORTH CAROLINA, INCIDENT TO TEMPORARY ADDITIONAL DUTY.
ALTHOUGH CLAIMANT WAS NOT INFORMED THAT TRAVEL TIME IN EXCESS OF THAT
REQUIRED FOR COMMON CARRIER TRANSPORTATION COULD NOT BE AUTHORIZED, ANY
MISTAKE OR FAILURE OF GOVERNMENT PERSONNEL TO FURNISH PROPER INFORMATION
DOES NOT FURNISH A LEGAL BASIS TO ALLOW CLAIM.
SINCE THE POINTS BETWEEN WHICH THE TRAVEL WAS PERFORMED WERE
ADEQUATELY SERVED BY COMMON CARRIER AND AS NO DUTY WAS DIRECTED EN ROUTE
REQUIRING THE USE OF A PRIVATELY OWNED VEHICLE THERE IS NO PROPER BASIS
FOR A DETERMINATION THAT THE USE OF SUCH TRANSPORTATION WOULD HAVE BEEN
MORE ADVANTAGEOUS TO THE GOVERNMENT. THEREFORE, REIMBURSEMENT OF TRAVEL
EXPENSES ABOVE THE AMOUNT ALLOWED HAD MEMBER TRAVELED BY COMMON CARRIER
IS NOT PERMITTED.
TO CAPTAIN RALPH A. MILTON, USMC:
FURTHER REFERENCE IS MADE TO YOUR CLAIM, WHICH WAS FORWARDED HERE
THROUGH MILITARY CHANNELS ON JANUARY 6, 1971, THAT YOU BE CREDITED WITH
ADDITIONAL TRAVEL TIME INCIDENT TO TEMPORARY ADDITIONAL DUTY AT CAMP
LEJEUNE, NORTH CAROLINA.
BY ORDERS OF THE COMMANDING GENERAL, 5TH MARINE DIVISION
(REINFORCED), FLEET MARINE FORCE, CAMP PENDLETON, CALIFORNIA 92055,
DATED JUNE 20, 1969, YOU WERE DIRECTED TO PROCEED TO CAMP LEJEUNE, NORTH
CAROLINA, ON OR ABOUT JULY 8, 1969, AND REPORT THERE BY AUGUST 5, 1969,
FOR TEMPORARY ADDITIONAL DUTY TO ATTEND THE MOTOR TRANSPORT OFFICER
COURSE FOR A PERIOD OF THIRTEEN WEEKS. UPON COMPLETION OF THE COURSE
YOU WERE TO RETURN TO YOUR ORIGINAL STATION. TRAVEL BY PRIVATELY OWNED
CONVEYANCE WAS AUTHORIZED. IN ADDITION, YOU WERE AUTHORIZED 20 DAYS
DELAY TO BE CHARGED AS LEAVE EN ROUTE TO CAMP LEJEUNE.
MEMORANDUM ENDORSEMENT DATED OCTOBER 15, 1969, OF THE COMMANDING
GENERAL, MARINE CORPS BASE, CAMP LEJEUNE, INDICATES THAT YOUR DUTY THERE
WOULD BE COMPLETED ON NOVEMBER 5, 1969, AND YOU WERE ORDERED TO REPORT
TO YOUR PARENT ORGANIZATION NO LATER THAN ON NOVEMBER 14, 1969. YOU
WERE AUTHORIZED 8 DAYS' DELAY IN REPORTING, CHARGEABLE AS LEAVE, AND ONE
DAY'S TRAVEL VIA PRIVATELY OWNED CONVEYANCE, WITH ALL TRAVEL TIME IN
EXCESS OF THAT AUTHORIZED FOR AIR TRAVEL, TO BE CHARGED AS LEAVE.
THE RECORD BEFORE US SHOWS THAT YOU DEPARTED FROM CAMP PENDLETON ON
JULY 8, 1969, AND ARRIVED AT CAMP LEJEUNE ON AUGUST 4, 1969. AFTER
COMPLETION OF YOUR COURSE OF INSTRUCTION THERE, YOU LEFT CAMP LEJEUNE ON
NOVEMBER 5, 1969, AND ARRIVED AT CAMP PENDLETON ON NOVEMBER 9, 1969.
AFTER YOUR RETURN TO CAMP PENDLETON, MEMORANDUM DATED NOVEMBER 20,
1969, WAS ISSUED BY THE COMMANDING GENERAL, 5TH MARINE DIVISION. IT
PROVIDES THAT PARAGRAPH 4 OF YOUR ORIGINAL ORDERS WHICH AUTHORIZED
TRAVEL BY PRIVATELY OWNED CONVEYANCE WAS THEREBY DELETED AND IN LIEU
THEREOF THERE WAS SUBSTITUTED THE STATEMENT THAT "TRAVEL VIA PRIVATELY
OWNED CONVEYANCE IS AUTHORIZED AND SUCH MODE IS CONSIDERED TO BE MORE
ADVANTAGEOUS TO THE GOVERNMENT."
TRAVEL ADVANCES TOTALING $576.15 WERE PAID TO YOU. HOWEVER, BECAUSE
OF DOUBT REGARDING YOUR ENTITLEMENT TO TRAVEL ALLOWANCES, THIS AMOUNT
WAS ENTERED AS A CHECKAGE IN YOUR ACCOUNT AND YOUR CLAIM WAS FORWARDED
TO THIS OFFICE. TOTAL PAYMENT OF $606.30 WAS AUTHORIZED BY OUR CLAIMS
DIVISION SETTLEMENT OF MAY 26, 1970, WHICH INCLUDED A MONETARY ALLOWANCE
OF $0.05 PER MILE AND INCLUDED PER DIEM FOR ONE DAY'S TRAVEL FROM YOUR
PERMANENT DUTY STATION TO CAMP LEJEUNE AND 3/4 DAY'S PER DIEM FOR YOUR
RETURN TRAVEL. IN EXPLANATION IT WAS STATED THAT THE RETROACTIVE
AMENDMENT OF THE ORIGINAL TRAVEL ORDERS COULD NOT OPERATE TO INCREASE
THE MONETARY ALLOWANCE TO $0.07 PER MILE SINCE THERE WAS NO OBVIOUS
ERROR EVIDENT IN THE ORIGINAL ORDERS, NOR DID IT APPEAR THAT IT WAS, IN
FACT, ADVANTAGEOUS TO THE GOVERNMENT TO HAVE YOU UTILIZE A PRIVATELY
OWNED VEHICLE.
BY ENDORSEMENT OF FEBRUARY 18, 1970, TO THE LETTER TRANSMITTING YOUR
ORIGINAL CLAIM TO THIS OFFICE, THE COMMANDING GENERAL OF THE 5TH MARINE
EXPEDITIONARY BRIGADE, FLEET MARINE FORCE, REPORTED AS FOLLOWS:
"THE TRAVEL ORDERS ORIGINALLY PREPARED AND ISSUED IN THE CASE OF
CAPTAIN MILTON WERE DONE SO ERRONEOUSLY AS STATED HEREIN; IT WAS THE
INTENTION OF THIS COMMAND TO AUTHORIZE TRAVEL VIA PRIVATELY OWNED
CONVEYANCE SUBJECT TO REIMBURSEMENT FOR TRANSPORTATION. TRAVEL TIME NOT
CHARGEABLE AS ANNUAL LEAVE, AND NO ADDITIONAL PER-DIEM EXPENSES TO THE
GOVERNMENT. HOWEVER, IN ACCORDANCE WITH EXISTING INSTRUCTIONS IT IS
REALIZED THAT CAPTAIN MILTON WAS ERRONEOUSLY ADVISED THAT TRAVEL TIME
WOULD NOT BE CHARGEABLE AS ANNUAL LEAVE AND THEREFORE IN GOOD FAITH DID
ACCEPT THE ORDERS AS ISSUED."
BY LETTER OF DECEMBER 28, 1970, ALSO FROM THE COMMANDING GENERAL OF
THE 5TH MARINE EXPEDITIONARY BRIGADE, FLEET MARINE FORCE, WE WERE
FURTHER ADVISED THAT WHEN YOUR ORIGINAL ORDERS WERE WRITTEN IT WAS THE
INTENT OF THAT COMMAND TO AUTHORIZE EIGHT DAYS TRAVEL TO YOUR TEMPORARY
DUTY STATION AND EIGHT DAYS TRAVEL IN RETURNING TO YOUR PARENT DUTY
STATION.
IN YOUR STATEMENT OF OCTOBER 29, 1970, YOU SAY THAT YOU QUESTIONED
THE ORDERS YOU ORIGINALLY RECEIVED AND THAT YOU WERE INFORMED BY THE
ORDER-WRITING AUTHORITY THAT YOU WOULD NOT BE CHARGED LEAVE AS IT WAS
MORE ADVANTAGEOUS TO THE GOVERNMENT FOR YOU TO TRAVEL BY PRIVATELY OWNED
VEHICLE.
PARAGRAPH M4203-3 OF THE JOINT TRAVEL REGULATIONS, PROMULGATED
PURSUANT TO 37 U.S.C. 404(A), PROVIDES THAT WHEN AUTHORIZED TRAVEL IS
PERFORMED AT PERSONAL EXPENSE, THE MEMBER WILL BE REIMBURSED AT THE RATE
OF $0.05 PER MILE FOR THE OFFICIAL DISTANCE. WHERE THE MEMBER IS
PERFORMING OFFICIAL TRAVEL, THE PRESCRIBED RATE IS $0.07 PER MILE FOR
THE OFFICIAL DISTANCE, PROVIDED CERTAIN REQUIREMENTS ARE MET, INCLUDING
THAT THE TRAVEL ORDERS AUTHORIZE TRAVEL BY PRIVATELY OWNED VEHICLE AS
BEING MORE ADVANTAGEOUS TO THE GOVERNMENT. THE PARAGRAPH FURTHER
PROVIDES AS FOLLOWS:
"B. TRAVEL BY PRIVATELY OWNED CONVEYANCE
(1) POLICY. IT IS THE POLICY OF THE UNIFORMED SERVICES TO
'AUTHORIZE' (AS DISTINGUISHED FROM 'PERMIT') MEMBERS TO TRAVEL BY
PRIVATELY OWNED CONVEYANCE WHENEVER SUCH MODE OF TRANSPORTATION IS
ACCEPTABLE TO THE MEMBER AND IS DETERMINED TO BE MORE ADVANTAGEOUS TO
THE GOVERNMENT. THIS DETERMINATION SHOULD BE BASED ON THE FACTS IN EACH
INDIVIDUAL CASE AND AUTHORIZATION SHOULD NOT BE GRANTED UNLESS THE
ORDER-ISSUING AUTHORITY IS CONVINCED THAT SUCH MODE OF TRAVEL IS CLEARLY
MORE ADVANTAGEOUS TO THE GOVERNMENT THAN TRAVEL BY GOVERNMENT CONVEYANCE
OR PUBLIC CARRIER. THE ADVANTAGE GAINED BY THE GOVERNMENT MAY BE, FOR
EXAMPLE, A MORE EFFICIENT, ECONOMICAL, OR EXPEDITIOUS ACCOMPLISHMENT OF
GOVERNMENT BUSINESS, SHORT TRIPS OVER ROUTES WHERE COMMERCIAL
TRANSPORTATION IS NONEXISTENT OR WOULD BE SO TIME-CONSUMING AS TO UNDULY
DELAY PUBLIC BUSINESS." PARAGRAPH M4204 PROVIDES AS FOLLOWS:
"5. TRAVEL BY PRIVATELY OWNED CONVEYANCE. WHEN TRAVEL ORDERS
SPECIFICALLY STATE THAT TRAVEL BY PRIVATELY OWNED CONVEYANCE IS MORE
ADVANTAGEOUS TO THE GOVERNMENT, PER DIEM ALLOWANCES ARE PAYABLE FOR THE
ACTUAL TIME NECESSARY TO PERFORM THE DIRECTED TRAVEL. WHEN TRAVEL
ORDERS DO NOT CONTAIN SUCH STATEMENT, IT WILL BE CONSIDERED THAT TRAVEL
BY PRIVATELY OWNED CONVEYANCE IS FOR THE CONVENIENCE OF THE MEMBER. THE
RATE OF PER DIEM APPLICABLE AND THE PERIOD FOR WHICH PER DIEM IS PAYABLE
FOR TRAVEL BY PRIVATELY OWNED CONVEYANCE SHALL BE AT THE RATE APPLICABLE
TO SUCH MODE FOR THE TIME ACTUALLY CONSUMED, THE TOTAL PER DIEM PAYABLE
NOT TO EXCEED THAT PAYABLE FOR CONSTRUCTIVE TRAVEL OVER A USUALLY
TRAVELED ROUTE BY AIR OR SURFACE COMMON CARRIER, WHICHEVER MORE NEARLY
MEETS THE REQUIREMENTS OF THE ORDERS AND IS MORE ECONOMICAL TO THE
GOVERNMENT."
IT IS THE GENERAL RULE THAT TRAVEL ORDERS MAY NOT BE REVOKED OR
MODIFIED RETROACTIVELY SO AS TO INCREASE OR DECREASE THE RIGHTS WHICH
HAVE ACCRUED OR BECOME FIXED UNDER THE LAW AND REGULATIONS, WHEN THE
ORDERED TRAVEL HAS BEEN PERFORMED. AN EXCEPTION TO THIS RULE HAS BEEN
RECOGNIZED WHEN AN ERROR IS APPARENT ON THE FACE OF THE ORIGINAL ORDERS,
OR WHEN THERE HAS BEEN A FULL DISCLOSURE BY THE ADMINISTRATIVE OFFICE
CONCERNED OF ALL THE FACTS AND CIRCUMSTANCES SURROUNDING THE ISSUANCE OF
SUCH ORDERS AND THE RECORD ESTABLISHES THAT SOME PROVISION PREVIOUSLY
DETERMINED AND OTHERWISE AUTHORIZED AND DEFINITELY INTENDED WAS OMITTED
THROUGH ERROR OR INADVERTENCE IN PREPARING THE ORDERS. 23 COMP. GEN.
713 (1944); 24 ID. 439 (1944).
WHEN TRAVEL BY PRIVATE VEHICLE INCIDENT TO TEMPORARY ADDITIONAL DUTY
IS AUTHORIZED ON THE BASIS OF A FACTUAL DETERMINATION THAT IT WILL BE
MORE ADVANTAGEOUS TO THE GOVERNMENT, THE MEMBER IS REGARDED AS
PERFORMING TEMPORARY DUTY FOR THE ACTUAL TIME NECESSARY TO PERFORM THE
TRAVEL, AND NO LEAVE IS CHARGEABLE FOR THIS PERIOD. PER DIEM IS PAYABLE
FOR THE ENTIRE TIME OF TRAVEL, AND THE MEMBER IS ENTITLED TO A TRAVEL
ALLOWANCE OF $0.07 PER MILE FOR THE OFFICIAL DISTANCE. IF THE TRAVEL BY
PRIVATELY OWNED CONVEYANCE IS NOT AUTHORIZED AS MORE ADVANTAGEOUS TO THE
GOVERNMENT, HOWEVER, TRAVEL BY THAT MODE IS CONSIDERED TO BE FOR THE
CONVENIENCE OF THE MEMBER. HE IS THEN CONSIDERED TO BE IN PERFORMANCE
OF DUTY ONLY FOR THE CONSTRUCTIVE TRAVEL TIME BY COMMON CARRIER, AND HE
IS CHARGEABLE WITH LEAVE FOR THE REMAINDER OF THE ACTUAL TIME USED IN
TRAVEL. PER DIEM IS NECESSARILY LIMITED TO THE CONSTRUCTIVE TRAVEL
TIME. IN THESE CIRCUMSTANCES THE TRAVEL ALLOWANCE AUTHORIZED IS $0.05
PER MILE FOR THE OFFICIAL DISTANCE.
YOUR ORDERS AUTHORIZED THE USE OF A PRIVATELY OWNED CONVEYANCE AND
PROVIDED THAT YOU WERE TO DEPART YOUR STATION ON OR ABOUT JULY 8, 1969,
AND REPORT TO CAMP LEJEUNE BY AUGUST 5, 1969, 29 DAYS LATER. AS A
20-DAY DELAY EN ROUTE WAS AUTHORIZED, THE ORDERS INDICATE THE INTENTION
TO ALLOW THE REMAINING 9 DAYS AS TRAVEL TIME FOR WHICH NO LEAVE WOULD BE
CHARGED.
THE OFFICIAL STATEMENTS BEFORE US INDICATE THE ORIGINAL INTENTION WAS
TO GRANT ONLY ADDITIONAL TRAVEL TIME FOR TRAVEL BY PRIVATE CONVEYANCE,
AND NOT THE INCREASED ALLOWANCES AUTHORIZED FOR TRAVEL BY PRIVATELY
OWNED VEHICLE WHICH HAS BEEN DETERMINED TO BE MORE ADVANTAGEOUS TO THE
GOVERNMENT. THE ADMINISTRATIVE STATEMENTS DO NOT SAY THAT THERE WAS AN
ADMINISTRATIVE DETERMINATION THAT TRAVEL BY PRIVATELY OWNED VEHICLE WAS
MORE ADVANTAGEOUS TO THE GOVERNMENT NOR THAT A STATEMENT TO THIS EFFECT
WAS ERRONEOUSLY OMITTED FROM YOUR ORDERS.
SINCE THE POINTS BETWEEN WHICH THE TRAVEL WAS PERFORMED WERE
ADEQUATELY SERVED BY COMMON CARRIER AND AS NO DUTY WAS DIRECTED EN ROUTE
REQUIRING THE USE OF A PRIVATELY OWNED VEHICLE, IT SEEMS CLEAR THAT
THERE WOULD HAVE BEEN NO PROPER BASIS FOR A DETERMINATION THAT THE USE
OF SUCH TRANSPORTATION WOULD HAVE BEEN MORE ADVANTAGEOUS TO THE
GOVERNMENT.
THE ORDER-ISSUING AUTHORITY HAS SAID WITH RESPECT TO YOUR ORDER THAT
IT LATER REALIZED THAT ADDITIONAL TRAVEL TIME COULD NOT BE GRANTED IN
THE CIRCUMSTANCES. HOWEVER, WHILE THERE WAS AN ERRONEOUS BELIEF THAT
ADDITIONAL TRAVEL TIME COULD BE GRANTED BY MEANS OF THE ORIGINAL TRAVEL
ORDER AS WRITTEN, THE ORDER ITSELF APPEARS TO HAVE ACCURATELY REFLECTED
THE OFFICIAL INTENTION AT THAT TIME TO AUTHORIZE TRAVEL BY PRIVATELY
OWNED CONVEYANCE FOR YOUR CONVENIENCE.
AS EVIDENCE OF RECORD DOES NOT INDICATE THAT IT WAS THE INTENTION OF
THE ORDER-ISSUING AUTHORITY TO CONSIDER YOUR TRAVEL BY PRIVATE VEHICLE
AS MORE ADVANTAGEOUS TO THE GOVERNMENT, AND THAT A STATEMENT TO THAT
EFFECT WAS OMITTED IN THE ORIGINAL TRAVEL ORDERS THROUGH INADVERTANCE OR
ERROR, WE MUST CONSIDER THE MEMORANDUM ENDORSEMENT ISSUED AFTER THE
COMPLETION OF TRAVEL AS AN ATTEMPT TO RETROACTIVELY MODIFY THE ORIGINAL
ORDERS, AND TO BE WITHOUT EFFECT. SEE DECISION B-150276, DECEMBER 20,
1962, COPY ENCLOSED.
IT IS UNFORTUNATE THAT YOU WERE NOT INFORMED THAT TRAVEL TIME IN
EXCESS OF THAT REQUIRED FOR COMMON CARRIER TRANSPORTATION COULD NOT
VALIDLY BE AUTHORIZED TO YOU IN THE CIRCUMSTANCES. HOWEVER, WHERE THERE
IS NO ENTITLEMENT UNDER THE LAW AND REGULATIONS, ANY MISTAKE, OR FAILURE
OF GOVERNMENT PERSONNEL TO FURNISH PROPER ADVICE OR INFORMATION, DOES
NOT, IN OUR OPINION, FURNISH A LEGAL BASIS TO ALLOW A CLAIM.
CONSEQUENTLY, AS YOU ARE NOT ENTITLED TO ADDITIONAL TRAVEL TIME
INCIDENT TO YOUR TEMPORARY ADDITIONAL DUTY AT CAMP LEJEUNE NOR TO
ADDITIONAL TRAVEL ALLOWANCE OR PER DIEM, THE SETTLEMENT OF MAY 26, 1970,
IS SUSTAINED.
B-172006(2), MAY 13, 1971
BID PROTEST - DAVIS BACON ACT - WALSH HEALEY ACT
WITH REFERENCE TO THE PROTEST OF KENNEDY ELECTRIC COMPANY AGAINST THE
AWARD OF A CONTRACT FOR INSTALLATION OF ELECTRICAL WIRING, THE COMP.
GEN. ADVISES THAT SINCE IT APPEARS THAT THE PROCUREMENT MAY REQUIRE A
SUBSTANTIAL AMOUNT OF ALTERATION OR REPAIR WORK, A DETERMINATION SHOULD
BE MADE OF THE EXTENT, IF ANY, THE DAVIS-BACON PROVISIONS SHOULD BE
APPLIED TO THE CONTRACT, USING AS A GUIDELINE SECTION 1-12.402-2 OF THE
FEDERAL PROCUREMENT REGULATIONS. IN ADDITION, 41 U.S.C. 40 AUTHORIZES
THE SECRETARY OF LABOR TO MAKE EXCEPTIONS TO THE WALSH-HEALEY
MANUFACTURER OR REGULAR DEALER STIPULATIONS IN A SOLICITATION UPON A
WRITTEN FINDING BY THE HEAD OF THE CONTRACTING AGENCY THAT THE INCLUSION
OF SUCH STIPULATIONS WILL SERIOUSLY IMPAIR THE CONDUCT OF GOVERNMENT
BUSINESS.
TO MR. SPENCE:
REFERENCE IS MADE TO YOUR LETTER OF APRIL 1, 1971, FURNISHING US A
REPORT IN CONNECTION WITH THE SECOND PROTEST BY KENNEDY ELECTRIC
COMPANY, INC. (KENNEDY), AGAINST AWARD OF A CONTRACT UNDER PURCHASE
REQUEST NO. 12770 FOR THE FURNISHING OF LABOR AND MATERIAL TO INCREASE
THE ELECTRICAL CAPACITY AT THE GOVERNMENT PRINTING OFFICE (GPO).
ENCLOSED IS A COPY OF OUR DECISION OF TODAY TO KENNEDY IN WHICH WE
HOLD THAT THE PROCUREMENT SHOULD BE READVERTISED.
AS INDICATED IN THE DECISION, SINCE IT APPEARS THAT THE PROCUREMENT
MAY REQUIRE A SUBSTANTIAL AMOUNT OF ALTERATION OR REPAIR WORK, WE
BELIEVE A DETERMINATION SHOULD BE MADE OF THE EXTENT, IF ANY, THE
DAVIS-BACON ACT PROVISIONS SHOULD BE APPLIED TO THE CONTRACT, USING AS A
GUIDELINE SECTION 1-12.402-2 OF THE FEDERAL PROCUREMENT REGULATIONS. WE
ALSO WISH TO POINT OUT THAT 41 U.S.C. 40 AUTHORIZES THE SECRETARY OF
LABOR TO MAKE EXCEPTIONS TO THE WALSH-HEALEY MANUFACTURER OR REGULAR
DEALER STIPULATIONS IN A SOLICITATION AND RESULTING CONTRACT UPON A
WRITTEN FINDING BY THE HEAD OF THE CONTRACTING AGENCY THAT THE INCLUSION
OF SUCH STIPULATIONS WILL SERIOUSLY IMPAIR THE CONDUCT OF GOVERNMENT
BUSINESS.
IT IS ALSO NOTED THAT PARAGRAPH 6.01 OF THE PURCHASE REQUEST STATES
THAT ALL PROVISIONS OF GPO CONTRACT TERMS NO. 1 WILL APPLY UNLESS
OTHERWISE PROVIDED TO THE CONTRARY. THE CONTRACT TERMS INCLUDE BOTH
WALSH-HEALEY ACT PROVISIONS (ARTICLE 30) AND DAVIS-BACON ACT PROVISIONS
(ARTICLE 42), AND WHILE THERE WAS NO INTENTION TO INCLUDE THE
DAVIS-BACON ACT PROVISIONS THE PURCHASE REQUEST DID NOT SO STATE.
ALTHOUGH WE RECOGNIZE CERTAIN MERIT IN THE CONTENTION THAT ARTICLE 30
AND ARTICLE 42 ARE SELF-DELETING, DEPENDING ON THE TYPE OF CONTRACT
INVOLVED, THIS CASE ILLUSTRATES THE LIKELIHOOD OF CONFUSION WHEN THE
TYPE OF CONTRACT ANTICIPATED IS NEITHER SPECIFIED NOR CLEARLY EVIDENT.
IT IS THEREFORE RECOMMENDED THAT FUTURE PROCUREMENTS, IN WHICH CONTRACT
TERMS NO. 1 IS INCORPORATED BY PROVISIONS SUCH AS PARAGRAPH 6.01,
SPECIFICALLY DELETE INAPPLICABLE ARTICLES AND IDENTIFY THE TYPE OF
CONTRACT CONCERNED.
THE FILE TRANSMITTED WITH YOUR LETTER OF APRIL 1, 1971, IS RETURNED.
B-172227, MAY 13, 1971
BID PROTEST - LATE BID - DEVIATION FROM SPECIFICATIONS
DECISION DENYING PROTEST AGAINST AWARD OF A CONTRACT TO IRVING L.
WILSON COMPANY UNDER AN IFB ISSUED BY THE BUREAU OF INDIAN AFFAIRS FOR
THE PROCUREMENT OF POLICE UNIFORMS.
BECAUSE SUCCESSFUL BIDDER WOULD HAVE SUBMITTED A TIMELY BID BUT FOR
MISHANDLING BY THE GOVERNMENT, THE CONTRACTING OFFICER PROPERLY DECIDED
TO CONSIDER THE BID PURSUANT TO PARAGRAPH 8(A) STANDARD FORM 33A. ALSO
THE DEVIATIONS IN THE SPECIFICATIONS - FIVE BUTTONS ON THE JACKET,
INSTEAD OF FOUR, AND SCALLOPED POCKET FLAPS INSTEAD OF PLAIN - WERE
REASONABLY DETERMINED TO BE MINOR AND PROPERLY WAIVED.
TO S. LIVINGSTON & SON, INCORPORATED:
FURTHER REFERENCE IS MADE TO YOUR LETTER OF MARCH 17, 1971,
PROTESTING THE AWARD OF A CONTRACT TO THE IRVING L. WILSON COMPANY,
BALA-CYNWYD, PENNSYLVANIA, PURSUANT TO INVITATION FOR BIDS NO.
DIA-K51-575, ISSUED BY THE BUREAU OF INDIAN AFFAIRS, DEPARTMENT OF THE
INTERIOR, FOR THE PROCUREMENT OF POLICE UNIFORMS.
YOU INDICATED THAT THE BID OF THE IRVING L. WILSON COMPANY WAS NOT
AMONG THOSE OPENED AND READ DURING THE PUBLIC OPENING OF BIDS WHICH
COMMENCED AT 10:00 A.M., JANUARY 15, 1971; AND THAT, UPON YOUR
INSPECTION OF SAMPLES SUBMITTED BY THE COMPANY AFTER AWARD OF THE
CONTRACT, IT WAS FOUND THAT THERE EXISTED A LACK OF CONFORMITY WITH THE
ADVERTISED SPECIFICATIONS FOR ITEMS NOS. 3 AND 4 OF THE BIDDING
SCHEDULE.
AT THE BID OPENING ON JANUARY 15, 1971, FIVE BIDS WERE OPENED AND
READ. REPRESENTATIVES OF TWO OF THE FIVE BIDDERS, YOUR COMPANY AND
ANOTHER FIRM LOCATED IN WASHINGTON, D.C., WERE PRESENT. BIDS HAD BEEN
REQUESTED ON EIGHT ITEMS OF CLOTHING, AND THE LOWEST OF THE FIVE BIDS
WAS SUBMITTED BY YOUR COMPANY. THE BID OPENING OFFICER WAS ALERTED TO
THE POSSIBILITY THAT A BID HAD BEEN OR WOULD BE RECEIVED FROM ANOTHER
COMPANY, THE IRVING L. WILSON COMPANY, SINCE A LETTER DATED JANUARY 14,
1971, HAD BEEN RECEIVED FROM METCALF BROTHERS & COMPANY, NEW YORK, NEW
YORK, CERTIFYING THE AVAILABILITY OF METCALF MATERIALS, AND CARRYING THE
NOTATION: "C.C. IRVING L. WILSON COMPANY."
AT APPROXIMATELY 11:00 A.M., JANUARY 15, 1971, IT WAS DISCOVERED THAT
THE IRVING L. WILSON COMPANY HAD SUBMITTED A BID WHICH WAS RECEIVED IN
THE MAILROOM OF THE BUREAU OF INDIAN AFFAIRS AT 9:26 A.M., JANUARY 14,
1971. AN EMPLOYEE OF THE BUREAU TELEPHONED HER OFFICE ON JANUARY 15,
1971, STATING THAT SHE WOULD COME IN LATE AND THAT AN ENVELOPE
CONTAINING A BID HAD BEEN PLACED IN A LOCKED FILE DRAWER. IT WAS
EXPLAINED THAT THE PLACE FOR DEPOSITING OF SEALED BIDS WAS NOT KNOWN AND
THAT RECEIPT OF THE ENVELOPE WAS NOT MENTIONED TO ANYONE ON JANUARY 14
AS MANY EMPLOYEES WERE ABSENT ON THAT DATE DUE TO THE ICY CONDITION OF
THE ROADS.
SINCE THE BID WAS LATE ONLY BECAUSE OF MISHANDLING BY THE GOVERNMENT
AFTER RECEIPT AT THE GOVERNMENT INSTALLATION, THE CONTRACTING OFFICER
DECIDED TO OPEN AND CONSIDER THE BID PURSUANT TO PARAGRAPH 8(A) OF THE
SOLICITATION INSTRUCTIONS AND CONDITIONS, STANDARD FORM 33A. IT WAS
FOUND THAT THE IRVING L. WILSON COMPANY HAD SUBMITTED THE LOWEST TOTAL
BID ON THE EIGHT ITEMS OF THE BIDDING SCHEDULE. AT PAGE 25 OF THE
INVITATION FOR BIDS, THE COMPANY LISTED EXCEPTIONS TO SPECIFICATIONS
WHICH RELATED TO THE QUANTITIES OF WINTER WEIGHT JACKETS AND SUMMER
SHIRTS SPECIFIED IN ITEMS NOS. 3 AND 4. THE COMPANY STATED THAT THE
JACKETS AND SHIRTS WOULD BE FURNISHED IN STOCK SIZES AND THAT THE
OFFERED WINTER JACKETS WOULD VARY FROM SPECIFICATIONS IN THE FOLLOWING
RESPECTS:
(1) FIVE BUTTONS ON THE JACKET WOULD BE SUPPLIED INSTEAD OF 4, AS
SHOWN ON THE GOVERNMENT'S DRAWING; AND (2) THE POCKET FLAPS WOULD BE
SCALLOPED INSTEAD OF PLAIN. THE STATEMENT OF EXCEPTIONS WAS DETERMINED
NOT TO AFFECT THE SUBSTANCE OF THE BID IN ANY MATERIAL RESPECT, AND
AWARD WAS MADE TO THE IRVING L. WILSON COMPANY IN ACCORDANCE WITH
SUBPARAGRAPH 10(B) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS,
WHICH STATES THAT THE GOVERNMENT RESERVES THE RIGHT TO REJECT ANY AND
ALL OFFERS "AND TO WAIVE INFORMALITIES AND MINOR IRREGULARITIES IN
OFFERS RECEIVED."
IT IS REPORTED BY THE DEPARTMENT OF THE INTERIOR THAT, WHEN YOUR
REPRESENTATIVES WERE SHOWN THE SAMPLES FOR ITEMS NOS. 3 AND 4, THEY TOOK
EXCEPTION TO BOTH, STATING THAT THE WINTER JACKETS HAD FIVE BUTTONS IN
THE FRONT INSTEAD OF FOUR AND THAT THE POCKET IN THE SUMMER SHIRT
DIFFERED FROM THE DRAWING. THE DEPARTMENTAL REPORT SETS FORTH THAT IT
WAS EXPLAINED TO YOUR REPRESENTATIVES THAT THE VARIATIONS IN THE BID
WERE MINOR DEVIATIONS PERMISSIBLE UNDER PARAGRAPH 10 OF STANDARD FORM
33A. SO FAR AS CONCERNS YOUR STATEMENT OF ACKNOWLEDGMENT BY THE
CONTRACTING OFFICIALS THAT THEY WERE NOT EXPERIENCED IN HANDLING
PROCUREMENTS OF POLICE UNIFORMS, THE DEPARTMENT STATES THAT THE EMPLOYEE
WHO HANDLED THE TRANSACTION HAS BEEN ENGAGED IN THE PROCUREMENT OF
TEXTILES FOR SEVERAL YEARS AND THAT YOUR REPRESENTATIVES WERE ADVISED
ONLY THAT THERE HAD BEEN A CHANGE IN BUREAU POLICY, IT HAVING BEEN
DECIDED THAT THE VARIOUS INDIAN ACTIVITIES WOULD PROCURE THEIR OWN
UNIFORMS IN THE FUTURE.
SECTION 2-405 OF THE FEDERAL PROCUREMENT REGULATIONS DEFINES A MINOR
INFORMALITY OR IRREGULARITY IN BID AS ONE WHICH IS MERELY A MATTER OF
FORM OR IS SOME IMMATERIAL VARIATION FROM THE EXACT REQUIREMENTS OF THE
INVITATION FOR BIDS, HAVING NO EFFECT OR MERELY A TRIVIAL OR NEGLIGIBLE
EFFECT ON PRICE, QUALITY, QUANTITY, OR DELIVERY OF THE SUPPLIES OR
PERFORMANCE OF THE SERVICES BEING PROCURED, AND THE CORRECTION OR WAIVER
OF WHICH WOULD NOT AFFECT THE RELATIVE STANDING OF, OR BE OTHERWISE
PREJUDICIAL TO, BIDDERS. IN DECIDING WHETHER A VARIATION IN BID IS
MINOR OR NOT, A CONTRACTING OFFICER MUST EXERCISE A REASONABLE DEGREE OF
DISCRETION. IT DOES NOT APPEAR THAT THE TWO DEVIATIONS COMPLAINED OF
HAD ANY ADVERSE EFFECT ON THE QUALITY OR UTILITY OF THE ITEMS; NOR THAT
THEY REDUCED THE COST OF PRODUCING THE GARMENTS. THEREFORE, WE CANNOT
FIND THAT THE CONTRACTING OFFICER'S DECISION IN THIS CASE, THAT THE
DEVIATIONS IN THE BID OF THE IRVING L. WILSON COMPANY WERE MINOR AND
COULD PROPERLY BE WAIVED, WAS ARBITRARY IN ANY RESPECT.
IN THE CIRCUMSTANCES, SINCE THE BID WAS RECEIVED ON A TIMELY BASIS
AND THE CONTRACTING OFFICER REASONABLY DETERMINED THE DEVIATIONS IN BID
TO BE MINOR, WE WOULD NOT BE WARRANTED IN TAKING EXCEPTION TO THE
CONTRACT AS AWARDED TO THE IRVING L. WILSON COMPANY.
ACCORDINGLY, YOUR PROTEST IS HEREBY DENIED.
B-172335, MAY 13, 1971
BID PROTEST - BID RESPONSIVENESS - NONSOLICITED DESCRIPTIVE LITERATURE
DECISION THAT A LOW BID BY DOALL BALTIMORE COMPANY SUBMITTED IN
RESPONSE TO AN IFB FOR ONE MANUAL FEED, HORIZONTAL, CUT-OFF BAND SAW,
MAY BE CONSIDERED FOR AWARD.
ALTHOUGH DOALL SUBMITTED DESCRIPTIVE LITERATURE WITH ITS BID AND THE
LITERATURE REFERRED TO FOUR CUT-OFF BAND SAW MODELS, ONLY TWO OF WHICH
CONFORMED TO THE REQUIRED SPECIFICATION, IT IS THE COMP. GEN.'S VIEW
THAT THE BID IS DEEMED TO OFFER ONE OF THE COMPLYING ITEMS AND THE BID
MAY THEREFORE BE CONSIDERED FOR AWARD.
TO MR. SECRETARY:
REFERENCE IS MADE TO YOUR LETTER DATED MARCH 25, 1971, IN WHICH YOU
REQUEST A DECISION AS TO WHETHER THE BID OF DOALL BALTIMORE COMPANY
SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. N00600-71-B-0156 MAY
BE CONSIDERED FOR AWARD.
THE IFB, ISSUED ON JANUARY 18, 1971, CALLED FOR ONE MANUAL FEED,
HORIZONTAL, CUT-OFF BAND SAW CONFORMING TO MILITARY SPECIFICATION
MIL-S-23847A, JULY 1, 1969, WITH CERTAIN MODIFICATIONS.
ALTHOUGH THE IFB DID NOT SOLICIT DESCRIPTIVE LITERATURE, DOALL
SUBMITTED WITH ITS BID, A BROCHURE ENTITLED "DOALL SERIES NINE (9)
CUT-OFF BAND SAWS" DESCRIBING FOUR DIFFERENT MODELS OF SAWS. THE BID
CONTAINS NO INDICATION OF THE SPECIFIC MODEL OFFERED. SINCE TWO OF THE
FOUR MODELS DESCRIBED IN THE BROCHURE CONFORM TO SPECIFICATIONS WHILE
THE OTHER TWO DO NOT, OUR ADVICE IS REQUESTED AS TO WHETHER THE DOALL
BID, WHICH IS LOW, MAY BE REGARDED AS RESPONSIVE.
IT IS OUR POSITION THAT WHERE UNSOLICITED DESCRIPTIVE LITERATURE
SUBMITTED WITH A BID DESCRIBES BOTH CONFORMING AND NONCONFORMING
ARTICLES, BUT CONTAINS NOTHING WHICH OTHERWISE CASTS DOUBT ON THE
BIDDER'S INTENTION TO COMPLY WITH THE SPECIFICATIONS, THE BID IS DEEMED
TO OFFER ONE OF THE COMPLYING ITEMS AND THE BID IS NOT THEREBY RENDERED
NONRESPONSIVE. 49 COMP. GEN. 851 (1970) AND B-169547, SEPTEMBER 17,
1970. ACCORDINGLY, THE DOALL BID, IF OTHERWISE PROPER, MAY BE
CONSIDERED FOR AWARD.
B-168725, MAY 12, 1971
BID PROTEST - COMPETITION
ADVISING THAT IN FUTURE PROCUREMENTS FOR EQUIPMENT SIMILAR TO OR
IDENTICAL WITH MODIFICATION OF SUPERVISORY CONTROL EQUIPMENT AT THE
NORFOLK NAVAL SHIPYARD, THE AMOUNT OF COMPETITION TRULY AVAILABLE SHOULD
FIRST BE DETERMINED.
IN RECONSIDERING THE PROTEST BY OCEAN ELECTRIC CORPORATION IT APPEARS
THAT NO MANUFACTURER OTHER THAN WESTINGHOUSE ELECTRIC CORPORATION IS
PRESENTLY CAPABLE OF SUPPLYING THE REQUIRED EQUIPMENT AND ALTHOUGH
WESTINGHOUSE ADVISED THE CONTRACTING OFFICER TO THE CONTRARY, IT APPEARS
THAT OFFERORS HAVE ENCOUNTERED DIFFICULTY IN OBTAINING INFORMATION FOR
OFFER FORMULATION. THE ABOVE PROBLEMS SHOULD BE RESOLVED PRIOR TO
INITIATING NEW PROCUREMENTS.
TO MR. SECRETARY:
BY LETTER DATED AUGUST 27, 1970, FILE 0211C/RP:KAM, THE NAVAL
FACILITIES ENGINEERING COMMAND FURNISHED US WITH A REPORT ON THE REQUEST
OF THE OCEAN ELECTRIC CORPORATION FOR RECONSIDERATION OF OUR DECISION OF
FEBRUARY 27, 1970, B-168725, TO THE EFFECT THAT SPECIFICATIONS UNDER
CONTRACT NO. N62470-69-C-0713, ISSUED BY THE NORFOLK NAVAL SHIPYARD,
WERE NOT SUBJECT TO QUESTION BY OUR OFFICE.
THE ORIGINAL PROTEST CONCERNED ALLEGATIONS BY OCEAN ELECTRIC THAT
SPECIFICATIONS FOR MODIFICATION OF EXISTING SUPERVISORY CONTROL
EQUIPMENT, INCLUDING THE INSTALLATION OF NEW SUPERVISORY CONTROL
EQUIPMENT TO BE COMPATIBLE WITH EXISTING SUPERVISORY CONTROL EQUIPMENT,
ORIGINALLY MANUFACTURED BY WESTINGHOUSE ELECTRIC CORPORATION, WERE
"PROPRIETARY," I.E., RESTRICTIVE, TO WESTINGHOUSE. THE BASIS FOR THIS
CONTENTION WAS THAT THE SPECIFICATION REQUIREMENT FOR STIPULATED
EXPERIENCE, COUPLED WITH A REQUIREMENT THAT THE NEW SUPERVISORY CONTROL
EQUIPMENT BE INSTALLED IN ACCORDANCE WITH THE ORIGINAL MANUFACTURER'S
DRAWINGS AND THAT THE NEW EQUIPMENT BE COMPATIBLE WITH EXISTING
EQUIPMENT, EFFECTIVELY PRECLUDED FIRMS OTHER THAN WESTINGHOUSE FROM
SUPPLYING THAT EQUIPMENT.
THE PROTEST FURTHER COMPLAINED THAT WESTINGHOUSE REFUSED TO FURNISH
PRIME OFFERORS WITH PRICE QUOTATIONS FOR THE NEW SUPERVISORY CONTROL
EQUIPMENT SEPARATE FROM THE OTHER NEW EQUIPMENT REQUIRED BY THE
CONTRACT. ALTHOUGH THE NEW SUPERVISORY CONTROL EQUIPMENT IS REPORTEDLY A
RELATIVELY MINOR PORTION OF THE NEW EQUIPMENT REQUIRED, IT WAS THE
POSITION OF OCEAN ELECTRIC THAT THE LUMP-SUM PRICE ALLEGEDLY QUOTED BY
WESTINGHOUSE, COUPLED WITH THE NAVY REFUSAL TO FURNISH WESTINGHOUSE SHOP
DRAWINGS CONCERNING EXISTING EQUIPMENT, MADE FORMULATION OF PROPER PRIME
OFFEROR ESTIMATES OF MATERIAL AND LABOR FOR THIS PHASE OF THE CONTRACT
DIFFICULT IF NOT IMPOSSIBLE. OCEAN ELECTRIC ALSO COMPLAINED THAT
WESTINGHOUSE ENGINEERING ASSISTANCE REQUIRED BY THE CONTRACT FOR
INSTALLATION OF THE NEW SUPERVISORY CONTROL EQUIPMENT WAS IMPOSSIBLE TO
ESTIMATE.
THE REPORT FURNISHED OUR OFFICE BY THE NAVAL FACILITIES ENGINEERING
COMMAND ON THE ORIGINAL PROTEST STATED THAT WESTINGHOUSE WAS NOT THE
ONLY ACCEPTABLE EQUIPMENT MANUFACTURER, AS EVIDENCED BY QUOTATIONS FROM
THE GENERAL ELECTRIC COMPANY TO PRIME OFFERORS FOR THE SUPPLY OF THE
REQUIRED EQUIPMENT; THAT WESTINGHOUSE HAD ADVISED THAT IT STOOD READY
TO FURNISH EQUIPMENT COST BREAKDOWNS UPON REQUEST (NO REQUEST HAVING
BEEN MADE BY ANY PRIME OFFERORS); AND THAT THE FURNISHING OF
WESTINGHOUSE SHOP DRAWINGS WOULD RESTRICT PURCHASE BY PRIME OFFERORS OF
NEEDED EQUIPMENT FROM WESTINGHOUSE ONLY. ON THIS BASIS, OUR OFFICE
CONCLUDED IN THE FEBRUARY 27, 1970, DECISION THAT "SUFFICIENT
JUSTIFICATION FOR THE USE OF THE SPECIFICATIONS AS PRESENTLY DRAFTED"
HAD BEEN PROVIDED.
OCEAN ELECTRIC CONTESTS OUR CONCLUSION BY ITERATING ITS CONTENTION
THAT WESTINGHOUSE, AS A MATTER OF COURSE, REFUSES TO PROVIDE COST
BREAKDOWNS BEFORE THE SUBMISSION OF OFFERS WHICH WOULD ENABLE PRIME
OFFERORS TO USE COMPONENT PARTS, OTHER THAN THOSE REQUIRED FOR
SUPERVISORY CONTROL EQUIPMENT, OF MANUFACTURERS OTHER THAN WESTINGHOUSE
IN FORMULATING THEIR OFFERS. WHILE IT IS CONCEDED BY OCEAN ELECTRIC
THAT WESTINGHOUSE WILL CONSENT TO SUPPLY SUPERVISORY CONTROL EQUIPMENT
SEPARATE FROM OTHER COMPONENTS AFTER THE AWARD OF A PRIME CONTRACT BASED
ON THE USE OF OTHER MANUFACTURERS' EQUIPMENT, THE POSITION OF OCEAN
ELECTRIC IS THAT WITHOUT KNOWLEDGE AT THE TIME OF PREPARATION OF OFFERS
AS TO WHAT WESTINGHOUSE WILL LATER CHARGE FOR ITS SUPERVISORY CONTROL
EQUIPMENT AND FOR ENGINEERING LABOR REQUIRED FOR ITS INSTALLATION, A
PRIME OFFEROR IS AT A LOSS TO PROPERLY FORMULATE ITS OFFER.
FOR EXAMPLE, OCEAN ELECTRIC POINTS OUT THAT, IN THE INSTANT
PROCUREMENT, WHILE WESTINGHOUSE INFORMED THE NAVY THAT THE REQUIRED
SUPERVISORY CONTROL EQUIPMENT WAS WORTH APPROXIMATELY $10,000, AFTER
AWARD IT WAS ABLE TO NEGOTIATE A PRICE OF $4,872 WITH WESTINGHOUSE FOR
THAT EQUIPMENT. FURTHER, OCEAN ELECTRIC HAS INDICATED THAT THERE WAS A
PRICE DIFFERENTIAL OF $82,500 BETWEEN THE WESTINGHOUSE LUMP-SUM PRICE
AND THE PRICE OF PURCHASING ALL THE EQUIPMENT, EXCEPT THE SUPERVISORY
EQUIPMENT, FROM OTHER SOURCES, MAKING IT PROBLEMATICAL FOR THE
CONTRACTOR TO ESTIMATE THE AMOUNT TO BE INCLUDED IN THE OFFER FOR THE
SUPERVISORY EQUIPMENT.
IN SUBSTANTIATION OF ITS CONTENTIONS, OCEAN ELECTRIC HAS SUBMITTED
LETTERS FROM OTHER BIDDERS TO THE EFFECT THAT THE SUBJECT SUPERVISORY
CONTROL EQUIPMENT IS ONLY AVAILABLE FROM WESTINGHOUSE AND THAT
WESTINGHOUSE WOULD NOT OFFER THAT EQUIPMENT FOR SALE INDEPENDENTLY OF
OTHER REQUIRED COMPONENTS AVAILABLE ELSEWHERE. ONE LETTER WAS FROM THE
GENERAL ELECTRIC COMPANY, NEWPORT NEWS, VIRGINIA, WHICH STATED AS
FOLLOWS:
"THE GENERAL ELECTRIC COMPANY CANNOT MATCH ITS COMPONENTS INTO AN
INTEGRATED SYSTEM WITH THE EXISTING SUPERVISORY EQUIPMENT INSTALLED AT
THE NORFOLK NAVAL SHIPYARD IN PORTSMOUTH, VIRGINIA WITHOUT CONSIDERABLE
RESEARCH, ENGINEERING AND FIELD MODIFICATION WORK.
"WE THEREFORE, DID NOT QUOTE THE ADD-ON SUPERVISORY PORTION OF THIS
JOB USING OUR OWN COMPONENTS.
HOWEVER, WE DID OBTAIN A VENDOR PRICE FROM WESTINGHOUSE ELECTRIC
COMPANY THROUGH OUR NORMAL PURCHASING CHANNELS IN ORDER TO OFFER A
PACKAGE."
ADDITIONALLY, OCEAN ELECTRIC POINTS OUT THAT THE NAVY PREVIOUSLY
REFERRED TO THE WESTINGHOUSE SUPERVISORY CONTROL EQUIPMENT AS
"PROPRIETARY" WHILE THE CURRENT NAVY POSITION IS THAT THE EQUIPMENT IS
NOT "PROPRIETARY" AND IS THEREFORE SUBJECT TO COMPETITIVE PROCUREMENT.
THE TERM "PROPRIETARY" IS USED BY THE PROTESTANT AND BY THE NORFOLK
NAVAL SHIPYARD TO REFER TO THE NEED OF THE GOVERNMENT FOR A SPECIALIZED
ITEM OF EQUIPMENT MANUFACTURED BY A SPECIFIC SOURCE RATHER THAN TO REFER
TO THE RESTRICTION PLACED BY A MANUFACTURER ON THE DISCLOSURE BY THE
GOVERNMENT OF DATA TO SOURCES OUTSIDE THE GOVERNMENT. IN THIS REGARD,
OCEAN ELECTRIC HAS SUBMITTED LETTERS FROM THE ACQUISITION DEPARTMENT,
ATLANTIC DIVISION, NAVAL FACILITIES ENGINEERING COMMAND, TO OCEAN
ELECTRIC, DATED FEBRUARY 21, 1968, AND JANUARY 9, 1969, REFERRING TO THE
SYSTEM INVOLVED AS "PROBABLY PROPRIETARY" AND "PROPRIETARY."
FINALLY, OCEAN ELECTRIC STATES THAT WESTINGHOUSE SUPERVISORY CONTROL
EQUIPMENT WAS FURNISHED AS GOVERNMENT-FURNISHED EQUIPMENT UNDER CONTRACT
NO. NBY-46660, A 1963 CONTRACT FOR SIMILAR MODIFICATION WORK, ALTHOUGH
THE INSTALLATION OF THE EQUIPMENT, WITH NECESSARY WESTINGHOUSE
ENGINEERING ASSISTANCE, REMAINED THE DUTY OF THE CONTRACTOR.
IN VIEW OF THE STATEMENT OF GENERAL ELECTRIC, QUOTED ABOVE, TO THE
EFFECT THAT GENERAL ELECTRIC COULD NOT FURNISH ITS OWN COMPONENTS FOR
USE WITH THE WESTINGHOUSE EQUIPMENT, IT APPEARS THAT NO MANUFACTURER
OTHER THAN WESTINGHOUSE IS PRESENTLY CAPABLE OF SUPPLYING THE REQUIRED
SUPERVISORY CONTROL EQUIPMENT. FURTHER, ALTHOUGH WESTINGHOUSE ADVISED
THE CONTRACTING OFFICER TO THE CONTRARY, IT APPEARS THAT OFFERORS, WITH
THE POSSIBLE EXCEPTION OF GENERAL ELECTRIC, HAVE ENCOUNTERED DIFFICULTY
IN OBTAINING INFORMATION NECESSARY FOR OFFER FORMULATION FROM
WESTINGHOUSE.
IN THE CIRCUMSTANCES, WE BELIEVE THAT THE CONTRACTING OFFICE MAY HAVE
BEEN UNDER THE ERRONEOUS IMPRESSION THAT THERE IS COMPETITION AVAILABLE
ON SUPERVISORY CONTROL EQUIPMENT AND THAT WESTINGHOUSE HAS BEEN
FURNISHING OFFERORS ALL THE INFORMATION NECESSARY TO PREPARE AN
INTELLIGENT OFFER. WE RECOMMEND, THEREFORE, THAT THIS MATTER, DISCUSSED
ABOVE, BE RESOLVED PRIOR TO INITIATING NEW PROCUREMENTS FOR SIMILAR OR
IDENTICAL EQUIPMENTS.
B-168907, MAY 12, 1971
MINERAL PATENTS - APPLICATIONS REJECTED - REFUND
ALLOWING THE CLAIM OF THE PACIFIC OIL COMPANY FOR REFUND OF PURCHASE
MONEY PAID IN CONNECTION WITH PATENT APPLICATIONS FILED FOR CERTAIN
MINING CLAIMS IN COLORADO WHICH WERE SUBSEQUENTLY REJECTED.
THE COMP. GEN. SEES NO REASON TO DISAGREE WITH THE FINDINGS OF THE
DEPUTY SOLICITOR OF THE DEPARTMENT OF THE INTERIOR THAT NO REFUND OF THE
PURCHASE MONEY HAS YET BEEN MADE UPON WITHDRAWAL OF THE MINING CLAIMS
AND THAT 43 U.S.C. 1374 DOES NOT REQUIRE PAYMENT FOR THE PURCHASE OF
LANDS THAT ARE NOT CONVEYED. THEREFORE, REJECTION OF THE PATENT
APPLICATIONS WARRANTS REFUND OF THE PURCHASE MONEY.
TO MR. CLAIR THUNEM:
YOUR LETTER OF JANUARY 26, 1970 (YOUR REFERENCE 1374(D-831)),
CONCERNS A CLAIM OF THE PACIFIC OIL COMPANY (PACIFIC) FOR REFUND OF
PURCHASE MONEY PAID IN CONNECTION WITH PATENT APPLICATIONS FILED FOR
CERTAIN ENUMERATED MINING CLAIMS, WHICH APPLICATIONS WERE SUBSEQUENTLY
REJECTED. IN OUR RESPONSE TO YOU OF MARCH 13, 1970, B-168907, WE
RETURNED THE MATERIALS TO YOU POINTING OUT THAT UNDER 31 U.S.C. 82D, THE
VOUCHER PRESENTED TO THE CERTIFYING OFFICER FOR CERTIFICATION MUST
ACCOMPANY A REQUEST FOR DECISION. WE ALSO NOTED THAT SECTION 204(A) OF
THE ACT OF JULY 14, 1960, 43 U.S.C. 1374, PLACES WITH THE SECRETARY OF
THE INTERIOR THE PRIMARY RESPONSIBILITY FOR DETERMINING WHETHER A REFUND
SHOULD BE MADE IN CASES INVOLVING THE SALE, ENTRY, LEASE, USE OR OTHER
DISPOSITION OF PUBLIC LANDS. WE FURTHER STATED THAT IF EITHER THE
SECRETARY, OR HIS DESIGNEE, IN HIS CONSIDERATION OF THE MATTER, OR YOU,
UPON RECEIPT OF AN ADMINISTRATIVE APPROVED VOUCHER, WISHED TO PRESENT
THE MATTER TO THIS OFFICE FOR A DECISION, WE WOULD CONSIDER IT AT THAT
TIME. ON APRIL 7, 1970, YOU RESUBMITTED THE MATTER TO THIS OFFICE,
ACCOMPANIED BY AN APPROVED VOUCHER. BECAUSE 43 U.S.C. 1374 PLACES THE
PRIMARY RESPONSIBILITY FOR DETERMINING WHETHER A REFUND SHOULD BE MADE
WITH THE SECRETARY OF THE INTERIOR, ON MAY 27, 1970, WE REQUESTED AN
EXPRESSION OF VIEWS ON THE MATTER FROM THE SECRETARY. BY LETTER DATED
MARCH 15, 1971, THE ASSISTANT SECRETARY REPLIED TO OUR LETTER,
INDICATING, IN EFFECT, THAT FOR THE REASONS STATED IN AN ENCLOSED
MEMORANDUM SIGNED BY THE DEPARTMENT'S DEPUTY SOLICITOR, IT WAS THE
DEPARTMENT'S OPINION THAT THE APPLICATION FOR REFUND WAS PROPER AND
SHOULD BE PAID.
THE FACTS AND CIRCUMSTANCES AS SET OUT IN THE DEPUTY SOLICITOR'S
MEMORANDUM, GIVING RISE TO PACIFIC'S CLAIMS ARE SUMMARIZED BELOW.
ON FEBRUARY 12, 1952, LANGDON H. LARWILL AND HORACE G. SLUSSER,
TRUSTEES FOR THE STOCKHOLDERS OF WHEELER SHALE CO., FILED MINERAL PATENT
APPLICATIONS COLORADO 04383 AND 04384. ON MAY 19, 1952, THE APPLICANTS
PAID PURCHASE MONEY IN THE AMOUNT OF $8,540 FOR THE LANDS INCLUDED IN
THE MINING CLAIMS SUBJECT TO COLORADO 04383 AND $6,350 FOR THE LANDS
INCLUDED UNDER COLORADO 04384. ON MAY 27, 1952, FINAL CERTIFICATES OF
MINERAL ENTRY WERE ISSUED AND THE PURCHASE MONEY APPLIED AS EARNED ON
THE SAME DATE.
ON NOVEMBER 18, 1952, THE APPLICANTS WITHDREW THREE OF THE 16 MINING
CLAIMS COVERED BY PATENT APPLICATION COLORADO 04384. THE REMAINING 13
CLAIMS CONTINUED SUBJECT TO PATENT APPLICATION 04384.
ON OCTOBER 28, 1953, THEY AGAIN FILED PATENT APPLICATION FOR THE
THREE CLAIMS WHICH HAD BEEN WITHDRAWN. THIS APPLICATION WAS GIVEN
SERIAL NO. COLORADO 07395. ON AUGUST 23, 1954, FINAL CERTIFICATE OF
MINERAL ENTRY WAS ISSUED FOR COLORADO 07395 AND $1,200 OF THE $6,350
INITIALLY PAID UNDER COLORADO 04384 WAS THEREUPON TREATED AS PURCHASE
MONEY PAYMENT FOR THE CLAIMS INCLUDED UNDER COLORADO 07395.
IN APRIL AND MAY 1959, THE MANAGER, COLORADO LAND OFFICE, REJECTED
THE PATENT APPLICATIONS ON THE GROUND THAT THE CLAIMS INVOLVED HAD BEEN
FRAUDULENTLY LOCATED. THE APPLICANTS APPEALED THROUGH THE
ADMINISTRATIVE PROCEDURES OF THE DEPARTMENT, LOSING AT EVERY STEP. THE
SECRETARY AFFIRMED THE DECISION IN LANGDON H. LARWILL, ET AL., A-28697
(MAY 16, 1963). ON SEPTEMBER 7, 1965, THE ORIGINAL APPLICANTS CONVEYED
THEIR RIGHTS, TITLE AND INTEREST IN THE CLAIMS TO PACIFIC. IN AN
ATTEMPT TO HAVE INTERIOR'S DECISION REVERSED, PACIFIC BROUGHT SUIT IN
THE FEDERAL COURT SYSTEM. IT LOST IN BOTH THE DISTRICT COURT AND THE
TENTH CIRCUIT COURT OF APPEALS AND ON JUNE 23, 1969, THE SUPREME COURT,
IN PACIFIC OIL V HICKEL, 395 U.S. 978, DENIED CERTIORARI.
ON JULY 30, 1969, A REPRESENTATIVE OF PACIFIC OIL COMPANY ORALLY
REQUESTED THAT REFUND BE MADE OF THE PURCHASE MONEY PAID FOR THE LANDS
INCLUDED IN THE MINING CLAIMS SUBJECT TO THE REJECTED PATENT
APPLICATIONS. WRITTEN REQUEST FOR THE SAID REFUND WAS MADE ON SEPTEMBER
23, 1969. THE STATE DIRECTOR, COLORADO, REVIEWED AND APPROVED THE CLAIM
FOR A REFUND. PRIOR TO CERTIFYING PAYMENT OF THE REFUND, YOU SUBMITTED
THE QUESTION OF THE PROPRIETY OF MAKING SAID REFUND TO THIS OFFICE FOR
DECISION. YOU NOTE IN YOUR SUBMISSION THAT ALL RECORDS DATED PRIOR TO
1960 RELATING TO THE MATTER HAVE BEEN DESTROYED, SO THAT YOU WERE UNABLE
TO DETERMINE INTO WHICH RECEIPT FUND THE PURCHASE MONIES HAD BEEN PAID
NOR WHETHER A REFUND HAD BEEN MADE PRIOR TO 1960. THE QUESTIONS YOU
PRESENT TO THIS OFFICE ASK, IN ESSENCE, WHETHER A REFUND CAN NOW BE MADE
AND, IF SO, FROM WHAT FUNDS AND TO WHOM THE REFUND IS PAYABLE.
AS NOTED ABOVE, 43 U.S.C. 1374 PLACES WITH THE SECRETARY OF THE
INTERIOR THE PRIMARY RESPONSIBILITY FOR DETERMINING WHETHER A REFUND
SHOULD BE MADE. THE ASSISTANT SECRETARY IN HIS LETTER TO THIS OFFICE
AGREES WITH THE CONCLUSION OF THE DEPUTY SOLICITOR OF YOUR DEPARTMENT
THAT A REFUND SHOULD BE GRANTED TO PACIFIC. IN SETTING FORTH THE
REASONS FOR HIS CONCLUSION, THE DEPUTY SOLICITOR IN HIS MEMORANDUM FIRST
DISCUSSES WHETHER THE PURCHASE MONIES APPLICABLE TO THAT PORTION OF
COLORADO 04384 WHICH WAS WITHDRAWN HAD BEEN REFUNDED TO THE APPLICANTS.
HE STATES:
"PATENT APPLICATION COLORADO 04384 WAS NOT WITHDRAWN IN ITS ENTIRETY.
THAT APPLICATION, AS FILED, COVERED SIXTEEN PLACER MINING CLAIMS. ON
NOVEMBER 18, 1952, THREE PLACER MINING CLAIMS, I.E., VICTORY NOS. 26,
27, AND 28, CONTAINING A TOTAL OF 480 ACRES OF LAND, WERE WITHDRAWN FROM
THE PATENT APPLICATION FOR THE STATED PURPOSE OF DOING ADDITIONAL
DEVELOPMENT WORK. IT WAS FURTHER STATED IN THE WITHDRAWAL THAT THE
APPLICATION WAS TO REMAIN IN FULL FORCE AND EFFECT AS TO ALL OTHER LANDS
EMBRACED IN THAT APPLICATION, I.E., AS TO THE THIRTEEN CLAIMS NOT
COVERED BY THE WITHDRAWAL.
"THIS WITHDRAWAL OF THE THREE CLAIMS WAS EFFECTED AFTER FINAL
CERTIFICATE OF MINERAL ENTRY HAD BEEN ISSUED ON MAY 27, 1952, AND THE
$6350 PURCHASE MONEY PAID IN CONNECTION WITH THE APPLICATION HAD BEEN
APPLIED AS EARNED. ACCOUNTING ADVICE NO. 7278 (DUPLICATE IN RECORD) IS
EVIDENCE OF THIS APPLICATION.
"WITHIN ONE YEAR AFTER THE WITHDRAWAL OF THE AFORESAID THREE CLAIMS,
ON OCTOBER 28, 1953, PACIFIC'S PREDECESSORS AGAIN FILED APPLICATION FOR
PATENT FOR THESE THREE CLAIMS. THIS APPLICATION WAS ASSIGNED THE SERIAL
NUMBER COLORADO 07395.
"IN CONNECTION WITH THIS APPLICATION, PACIFIC'S PREDECESSORS, AS
REQUIRED, FILED ON FEBRUARY 8, 1954, AN 'APPLICATION TO PURCHASE LANDS'
AND A 'PROOF OF SUMS PAID'. BOTH DOCUMENTS STATED THAT $1200 PURCHASE
MONEY (480 ACRES AT $2.50 PER ACRE) HAD BEEN PAID FOR THESE THREE CLAIMS
AT THE TIME THEY WERE INCLUDED UNDER COLORADO 04384. THE APPLICANTS
REQUESTED THAT THAT PAYMENT BE REAPPLIED AS PAYMENT UNDER THE NEW
APPLICATION IDENTIFIED AS COLORADO 07395. THE COVERING LETTER OF
FEBRUARY 5, 1954, ACCOMPANYING THESE DOCUMENTS CONTAINED STATEMENTS TO
THE SAME EFFECT.
"FINAL CERTIFICATE OF MINERAL ENTRY FOR COLORADO 07395 WAS ISSUED ON
AUGUST 23, 1954. THIS DOCUMENT STATES THAT RECEIPT NO. 10172 (ISSUED ON
MAY 27, 1952, FOR COLORADO 04384) COVERS THE $1200 PURCHASE MONEY DUE
UNDER THE APPLICATION. IN ADDITION, THE SPACE PROVIDED FOR THE PURCHASE
MONEY RECEIPT NUMBER CONTAINS THE ENTRY '10172'. ON THE FACE OF BOTH
THE APPLICATION TO PURCHASE LANDS AND THE PROOF OF SUMS PAID THERE
APPEARS A WRITTEN NOTATION THAT 'RECEIPT 10172 UNDER C-04384 COVERS THE
$1200 PURCHASE MONEY (L.O. BY H.O.)'. 'L.O. BY H.O.' REFERS,
PRESUMABLY, TO LAND OFFICE BY H. ODEGAARD. H. ODEGAARD WAS THEN
EMPLOYED BY THE COLORADO LAND OFFICE AND SHE PARTICIPATED IN THE
HANDLING OF THESE APPLICATIONS. (SEE, E.G., ACCOUNTING ADVICES 7277 AND
7278).
"IT IS OUR OPINION THAT THE ABOVE-MENTIONED CIRCUMSTANCES ADEQUATELY
ESTABLISH THAT THERE WAS NO REFUND OF PURCHASE MONEY UPON THE WITHDRAWAL
OF THE AFORESAID THREE MINING CLAIMS, THAT THE $6350 PURCHASE MONEY PAID
IN CONNECTION WITH COLORADO 04384 REMAINED WITH THAT APPLICATION UNTIL
THE FILING OF PATENT APPLICATION COLORADO 07395 AND SUPPORTING
DOCUMENTS, AND THAT $1200 WAS REAPPLIED AT THAT TIME TO THE LATTER
APPLICATION. AT THIS POINT, THERE WERE THREE PATENT APPLICATIONS OF
PACIFIC'S PREDECESSORS PENDING BEFORE THE DEPARTMENT, COLORADO 04383
($8540 PURCHASE MONEY), COLORADO 04384 ($5150 PURCHASE MONEY), AND
COLORADO 07395 ($1200 PURCHASE MONEY)."
THEN THE DEPUTY SOLICITOR DEALS WITH THE PROBLEM OF WHETHER ANY OF
THE PURCHASE MONIES HAD BEEN REFUNDED. HE STATES:
"THE RECORDS SHOW THAT THERE WAS NO OTHER WITHDRAWAL FILED IN
CONNECTION WITH THE THREE PATENT APPLICATIONS IN QUESTION. IT WAS NOT
UNTIL MAY 16, 1963, THAT FINAL ADMINISTRATIVE ACTION WAS TAKEN BY THE
DEPARTMENT REJECTING THE PATENT APPLICATIONS. THE DEPARTMENT'S
ACCOUNTING RECORDS ARE AVAILABLE FOR THE PERIOD FROM THAT DATE TO THE
PRESENT TIME. THERE IS NO RECORD OF ANY REFUND MADE TO PACIFIC OR ITS
PREDECESSORS.
"IT IS TO BE NOTED THAT THE APPLICANTS FILED TIMELY APPEALS FROM THE
DECISIONS OF THE MANAGER OF THE COLORADO LAND OFFICE AND OF THE ACTING
DIRECTOR OF THE BUREAU OF LAND MANAGEMENT. NONE OF THESE DECISIONS
PROVIDED THAT THE DECISION WAS EFFECTIVE UPON PROMULGATION.
CONSEQUENTLY, UNDER THE DEPARTMENTAL REGULATIONS IN EFFECT AT ALL
PERTINENT TIMES, THE SAID DECISIONS NEVER BECAME EFFECTIVE. SEE 43 CFR
221.101 (NOW 43 CFR 1853.8). IF THE APPLICANTS HAD WITHDRAWN A PATENT
APPLICATION AT ANY TIME DURING THE PERIOD FROM OCTOBER 28, 1953 TO MAY
16, 1963, THERE WOULD HAVE BEEN NO FURTHER CONSIDERATION OF THAT
APPLICATION ON THE MERITS BY THE DEPARTMENT. THE MATTER WOULD HAVE BEEN
MOOT. CLEARLY, THIS IS NOT THE CASE.
"THE SAME HOLDS TRUE AS TO THE COURT SUITS FOR JUDICIAL REVIEW OF THE
DEPARTMENT'S REJECTION OF THE PATENT APPLICATIONS ON MAY 16, 1963. IF
AN APPLICATION HAD BEEN WITHDRAWN AFTER THAT DATE, THERE WOULD HAVE BEEN
NO JUSTICIABLE CONTROVERSY INVOLVING THE DEPARTMENT'S FINAL
ADMINISTRATIVE ACTION REJECTING THAT PATENT APPLICATION, AND THE ISSUE
OF REJECTION WOULD HAVE BECOME MOOT. AND, WITHOUT A WITHDRAWAL, THERE
WOULD, OF COURSE, BE NO CAUSE FOR A REFUND OF PURCHASE MONEY.
"ACCORDINGLY, WE ARE SATISFIED THAT THE PURCHASE MONEY PAID IN
CONNECTION WITH COLORADO 04383, 04384, AND 07395, HAD NOT BEEN REFUNDED
TO PACIFIC OR PACIFIC'S PREDECESSORS PRIOR TO JUNE 23, 1969, THE DATE ON
WHICH THE SUPREME COURT DENIED CERTIORARI AND THE LITIGATION TERMINATED,
NOR WAS IT REFUNDED THEREAFTER. THE 'REPAYMENT SCHEDULES' OF THE
COLORADO LAND OFFICE COVERING PERIODS PRIOR TO AUGUST 31, 1960, HAVE
BEEN DESTROYED, IT IS TRUE, PURSUANT TO THE FEDERAL RECORDS DISPOSAL
PROGRAM AND ARE NOT AVAILABLE AS EVIDENCE TO SHOW THAT NO REFUND HAD
BEEN MADE DURING THAT PERIOD, BUT, IN OUR VIEW, THIS COLLATERAL EVIDENCE
IS NOT ESSENTIAL TO A DETERMINATION IN THIS CASE THAT NO REFUND HAD BEEN
MADE DURING THE PERIOD IN QUESTION."
HAVING DETERMINED THAT NO REFUND HAS PREVIOUSLY BEEN MADE, THE DEPUTY
SOLICITOR DISCUSSES WHETHER A REFUND IS NOW APPROPRIATE:
"SECTION 204(A) OF THE ACT OF JULY 14, 1960 (43 U.S.C. SEC 1374),
PROVIDES THAT THE SECRETARY, UPON APPLICATION OR OTHERWISE, MAY CAUSE A
REFUND TO BE MADE FROM APPLICABLE FUNDS WHERE HE IS SATISFIED THAT ANY
PERSON HAS MADE A PAYMENT UNDER AND STATUTE RELATING TO THE SALE, ENTRY,
LEASE, USE, OR OTHER DISPOSITION OF PUBLIC LANDS WHICH IS NOT REQUIRED,
OR IS IN EXCESS OF THE AMOUNT REQUIRED, BY APPLICABLE LAW AND THE
REGULATIONS ISSUED BY THE SECRETARY.
"THE APPLICABLE LAW AND REGULATIONS PROVIDE FOR THE PAYMENT OF $2.50
PER ACRE FOR THE PURCHASE OF LANDS INCLUDED IN A MINERAL PATENT FOR
PLACER MINING CLAIMS. THE FINAL REJECTION OF A MINERAL PATENT
APPLICATION IS, INTER ALIA, A REJECTION OF THE APPLICATION TO PURCHASE
LANDS. CLEARLY, THE LAW AND REGULATIONS RELATING TO THE ISSUANCE OF
MINERAL PATENTS DO NOT REQUIRE PAYMENT FOR THE PURCHASE OF LANDS THAT
ARE NOT CONVEYED. CONSEQUENTLY, THE REJECTION OF THE THREE PATENT
APPLICATIONS INVOLVED HEREIN WOULD WARRANT THE REFUND OF THE PURCHASE
MONEY PAID IN CONNECTION WITH THESE APPLICATIONS AND COVERED INTO THE
TREASURY, IF A REFUND IS SPECIFICALLY AUTHORIZED BY LAW AND OTHERWISE
PROPER. SECTION 204(A) OF THE ACT OF JULY 14, 1960, SUPRA, PROVIDES, AS
IT WAS INTENDED, THE NECESSARY AUTHORITY TO MAKE REFUNDS OF SUMS WHICH
HAVE BEEN APPLIED AS EARNED AND COVERED INTO THE TREASURY."
WITH DUE REGARD TO THE PROVISIONS OF 43 U.S.C. 1374, WE HAVE REVIEWED
THE CONCLUSIONS - AND THE BASES THEREFOR - PRESENTED BY THE DEPUTY
SOLICITOR IN HIS MEMORANDUM, AND, IN EFFECT, CONCURRED IN BY THE
ASSISTANT SECRETARY ON BEHALF OF THE DEPARTMENT, THAT THERE HAS BEEN NO
PREVIOUS REFUND OF THE PURCHASE MONIES AND THAT, THEREFORE, A REFUND AT
THIS TIME WOULD APPEAR PROPER. WE FIND NO REASON TO DISAGREE WITH THESE
CONCLUSIONS. ACCORDINGLY, REFUND OF THE $14,890 PURCHASE MONEY PAID IN
CONNECTION WITH MINERAL PATENT APPLICATIONS, COLORADO 04383, 04384, AND
07395, WOULD BE PROPER.
IN SUPPORT OF ITS CLAIM FOR REFUND PACIFIC HAS SUBMITTED A STATEMENT
TO THE EFFECT THAT NONE OF THE PURCHASE MONEY HAD BEEN PREVIOUSLY
REFUNDED; COPIES OF AGREEMENTS EXECUTED IN 1951 AND 1963 RELATING TO
VARIOUS RIGHTS OR INTERESTS OF PACIFIC AND ITS PREDECESSORS IN AND TO
THE MINING CLAIMS SUBJECT TO PATENT APPLICATIONS COLORADO 04383, 04384,
AND 07395; A STATEMENT TO THE EFFECT THAT DELIVERY HAD BEEN MADE TO
PACIFIC OF THE DEED OF CONVEYANCE OF THE SUBJECT MINING CLAIMS; AND A
STATEMENT TO THE EFFECT THAT PACIFIC HAS NOT ASSIGNED ITS RIGHT TO THE
PURCHASE MONEY IN QUESTION. IN ADDITION, PACIFIC'S PREDECESSORS IN
INTEREST HAVE SPECIFICALLY REQUESTED THAT THE REFUND BE PAID DIRECTLY TO
PACIFIC. WE AGREE WITH THE DEPUTY SOLICITOR THAT THE AFOREMENTIONED
DOCUMENTS MAY BE CONSIDERED TO REASONABLY ESTABLISH PACIFIC AS THE
PROPER PARTY TO RECEIVE THE REFUND.
FINALLY, THE DEPUTY SOLICITOR DISCUSSES THE PROPER FUND FROM WHICH
THE REFUND SHOULD BE PAID:
"2. RECEIPT OF PURCHASE MONEY PAID IN CONNECTION WITH COLORADO
04383, 04384, AND 07395 (SEE EARLIER DISCUSSION) WAS ACKNOWLEDGED BY
RECEIPTS 10171 AND 10172, DATED MAY 19, 1952.
"ACCOUNTING ADVICES NOS. 7277 AND 7278 WERE PREPARED UPON ISSUANCE OF
FINAL CERTIFICATE OF MINERAL ENTRY. ACCOUNTING ADVICE NO. 7277 RECITES
THAT IT APPLIES TO MINERAL ENTRY COLORADO 04383 COVERING 3415.97 ACRES
OF LAND LOCATED IN GARFIELD COUNTY, COLORADO. THE FOLLOWING STATEMENT
APPEARS UNDER THE CAPTION 'REMARKS':
"FINAL CERTIFICATE ISSUED MAY 27, 1952. APPLY $8540, PURCHASE MONEY,
RECEIPT 10171. (PURCHASE MONEY $2.50 PER ACRE OR FRACTION THEREOF)
SIMILARLY, ACCOUNTING ADVICE NO. 7278 RECITES THAT IT APPLIES TO MINERAL
ENTRY 04384 COVERING 2539.40 ACRES OF LAND LOCATED IN GARFIELD COUNTY,
COLORADO.
THE FOLLOWING STATEMENT APPEARS UNDER THE CAPTION 'REMARKS':
"FINAL CERTIFICATE ISSUED MAY 27, 1952. APPLY $6350, PURCHASE MONEY,
RECEIPT 10172. (PURCHASE MONEY $2.50 PER ACRE OR FRACTION THEREOF)
"IN OUR OPINION, THE ABOVE ACCOUNTING ADVICES SHOW THAT THE PURCHASE
MONEY IN QUESTION WAS TO BE APPLIED AS PURCHASE MONEY FOR LAND.
"WITH RESPECT TO THE APPLICATION OF MONEY AS EARNED, IT IS THE DULY
AUTHORIZED PRACTICE OF THE BUREAU OF LAND MANAGEMENT TO APPLY THE
PURCHASE MONEY SUBMITTED WITH AN APPLICATION FOR MINERAL PATENT AS
EARNED MONEY AT THE TIME OF ISSUANCE OF THE FINAL CERTIFICATE OF MINERAL
ENTRY. THE FINAL CERTIFICATES IN COLORADO 04383 AND 04384 WERE ISSUED
ON MAY 27, 1952, AND THE APPLICATION OF SUCH FUNDS AS EARNED IS
EVIDENCED BY ACCOUNTING ADVICES NOS. 7277 AND 7278. THE FINAL
CERTIFICATE IN COLORADO 07395 WAS ISSUED ON AUGUST 23, 1954, AND IT
SHOWS THAT THE RECEIPT OF PURCHASE MONEY AND ITS APPLICATION AS EARNED
MONEY IS RELATED BACK TO COLORADO 04384, AND RECEIPT NO. 10172 AND
ACCOUNTING ADVICE NO. 7278 THEREUNDER. (SEE EARLIER DISCUSSION.)
"AT ALL TIMES PERTINENT HEREIN, THE ONLY FUND AUTHORIZED BY THE
TREASURY DEPARTMENT FOR APPLICATION OF PURCHASE MONEY PAID IN CONNECTION
WITH A MINERAL PATENT APPLICATION IS THE FUND APPLICABLE TO THE SALE OF
LAND. THIS FUND IS REPRESENTED BY FUND SYMBOL 145881. APPLICATION OF
THE PURCHASE MONEY IN QUESTION TO ANY OTHER FUND WOULD HAVE BEEN
UNAUTHORIZED AND ERRONEOUS AND IS NOT TO BE PRESUMED.
"IT IS OUR OPINION THAT THE RECORDS ADEQUATELY SHOW THAT THE PURCHASE
MONEY WAS APPLIED IN THE FUND APPLICABLE TO THE SALE OF PUBLIC LAND,
WHICH IS REPRESENTED BY FUND SYMBOL 145881, AND ANY REFUND OF SUCH MONEY
SHOULD BE DEBITED AGAINST THE SAME FUND."
BASED ON THE FOREGOING DISCUSSION, WE AGREE THAT THE PURCHASE MONEY
MUST HAVE BEEN ERRONEOUSLY DEPOSITED INTO THE TREASURY FOR CREDIT TO
FUND SYMBOL 145881. THEREFORE, REFUND OF THE $14,890 PURCHASE MONIES
PAID IN CONNECTION WITH MINERAL PATENT APPLICATIONS COLORADO 04383,
04384, AND 07395, MAY BE PAID TO THE PACIFIC OIL COMPANY.
ACCORDINGLY, THE SUBMITTED VOUCHER MAY BE CERTIFIED FOR PAYMENT, IF
OTHERWISE CORRECT, AND THE VOUCHER TOGETHER WITH YOUR CASE FILE IS
RETURNED HEREWITH.
B-171253, MAY 12, 1971
BID PROTEST - BID RESPONSIVENESS
ADVISING THAT WHILE GAO CAN TAKE NO ACTION WITH RESPECT TO HIGHWAY
EQUIPMENT COMPANY'S PROTEST AGAINST AWARD OF A GSA CONTRACT, IT SHOULD
BE NOTED THAT PROTESTANT DELIBERATELY DEVIATED FROM THE REQUIREMENTS OF
THE IFB AND THE BID WAS PROPERLY FOUND TO BE NONRESPONSIVE.
ANY ORAL COMMUNICATION BY THE CONTRACTING OFFICER THAT A PARTICULAR
DEVIATION WAS MINOR AND HENCE WAIVABLE, IN THE ABSENCE OF A CONFIRMING
WRITTEN AMENDMENT ISSUED BEFORE BID OPENING IS NOT BINDING.
TO MR. G. E. ALLEN:
WE HAVE YOUR LETTER OF MARCH 22, 1971, COMMENTING ON THE REPORT
FURNISHED BY THE GENERAL SERVICES ADMINISTRATION (GSA) ON YOUR PROTEST
AGAINST THE AWARD MADE UNDER INVITATION FOR BIDS NO.
3FP-BF-R-B27412-10-22-70.
SINCE YOU CORRECTLY OBSERVED THAT NO ACTION BY OUR OFFICE IS NOW
POSSIBLE, WE WILL CONFINE OUR DISCUSSION TO A POINT OF PROTEST NOT
SPECIFICALLY COVERED IN THE GSA REPORT. IT IS CONCEDED THAT YOUR FIRM
DELIBERATELY DEVIATED FROM THE REQUIREMENT THAT THE CONVEYOR INCLUDED IN
THE SPREADER (THE PROCUREMENT ITEM) BE OF THE AUGER TYPE BY PROPOSING A
CHAIN-TYPE CONVEYOR. BECAUSE OF THIS, YOUR FIRM'S BID WAS FOUND TO BE
NONRESPONSIVE EVEN THOUGH YOU SAY THAT THE CONTRACTING OFFICER ORALLY
AGREED TO CONSIDER THIS DEVIATION MINOR AND HENCE WAIVABLE. HOWEVER,
PARAGRAPH 3 OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS SPECIFICALLY
STATES THAT ORAL COMMUNICATIONS ARE NOT BINDING IN THE ABSENCE OF A
CONFIRMING WRITTEN AMENDMENT ISSUED BEFORE BID OPENING. UNDER THESE
PROVISIONS, AND SINCE NO DEVIATION RESPECTING THE CONVEYOR WAS PROVIDED
FOR IN THE INVITATION, WE MUST CONCLUDE THAT THE BID WAS PROPERLY
REJECTED AS NONRESPONSIVE.
WHILE WE ARE UNABLE TO AGREE WITH YOUR POSITION ON THIS PROCUREMENT,
WE APPRECIATE RECEIVING THE BENEFITS OF YOUR VIEWS AND COMMENTS.
B-171609(2), MAY 12, 1971
BID PROTEST - EVALUATION FACTORS
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST AWARD OF
CONTRACT TO HONEYWELL, INC., LOW BIDDER, UNDER AN RFP ISSUED BY THE AIR
FORCE FOR THE GROUND SIMULATOR PORTION OF THE UNDERGRADUATE NAVIGATOR
TRAINING SYSTEM.
WHILE PROTESTANT'S TECHNICAL PROPOSAL WAS ORIGINALLY GIVEN A HIGHER
NUMERICAL RATING THAN THAT OF SUCCESSFUL LOW BIDDER, THIS WAS REVERSED
AFTER COMPLETION OF TECHNICAL NEGOTIATIONS. ALSO, THE AIR FORCE
CONSIDERED IN ITS EVALUATION PROTESTANT'S LIST OF 13 REQUIREMENTS AND
STILL CONCLUDED THAT HONEYWELL'S PROPOSAL WAS SUPERIOR. THEREFORE, THE
PROTEST MUST BE DENIED.
TO GENERAL ELECTRIC COMPANY:
THIS IS IN REPLY TO YOUR LETTER OF MARCH 12, 1971, RELATIVE TO THE
AIR FORCE DECISION TO AWARD A NEGOTIATED CONTRACT TO HONEYWELL, INC.,
FOR THE GROUND SIMULATOR PORTION OF THE UNDERGRADUATE NAVIGATOR TRAINING
SYSTEM.
THE AIR FORCE REQUESTED PROPOSALS FROM FIVE SOURCES TO ACQUIRE A
GROUND SIMULATOR TO SUPPORT THE TRAINING OF UNDERGRADUATE NAVIGATORS.
COMPREHENSIVE PERFORMANCE SPECIFICATIONS WERE ISSUED ALLOWING FOR
SUBMISSION OF DIFFERENT DESIGN APPROACHES. THE REQUEST FOR PROPOSALS
ALSO SET OUT MANY FACTORS WHICH WOULD BE ASSESSED IN EVALUATING
PROPOSALS AND IT WAS GENERALLY PROVIDED THAT THE FOLLOWING ORDER OF
IMPORTANCE WOULD GOVERN:
1. THE ABILITY OF THE GROUND SIMULATOR TO PERFORM THE AIR TRAINING
COMMAND'S TRAINING SUPPORT TASKS.
2. DELIVERY OF A FULLY OPERATIONAL AND SUPPORTABLE SYSTEM WITHIN THE
ESTABLISHED ACQUISITION SCHEDULE.
3. TOTAL COST TO THE GOVERNMENT.
YOUR LETTER EXPRESSES THE BELIEF THAT EVEN THOUGH HONEYWELL'S PRICE
WAS LOWER THAN THAT PROPOSED BY GENERAL ELECTRIC THE DIFFERENCE WAS SO
SLIGHT AS NOT TO OFFSET THE SUBSTANTIAL SUPERIORITY OF YOUR TECHNICAL
PROPOSAL. ON THOSE FACTS YOU CONTEND THE SELECTION OF HONEYWELL WOULD
CONSTITUTE A GROSS DEPARTURE FROM THE SELECTION CRITERIA STATED IN THE
SOLICITATION AND THAT WE SHOULD FIND SUCH AN AWARD TO BE IMPROPER.
ACCORDINGLY, YOU REQUEST THAT WE RESOLVE THE THRESHOLD QUESTION AS TO
YOUR TECHNICAL SUPERIORITY BY INQUIRING INTO WHETHER THE AIR FORCE,
THROUGH ITS RATING SYSTEM, RATED YOUR TECHNICAL PROPOSAL SUBSTANTIALLY
SUPERIOR TO THAT OF HONEYWELL.
WE HAVE REVIEWED THE ENTIRE RECORD OF THIS PROCUREMENT, INCLUDING
EVALUATION REPORTS BY THE SOURCE SELECTION EVALUATION BOARD AND THE
SOURCE SELECTION ADVISORY COUNSEL. WHILE AS INITIALLY SUBMITTED YOUR
TECHNICAL PROPOSAL WAS GIVEN A HIGHER NUMERICAL RATING THAN THAT OF
HONEYWELL, AFTER COMPLETION OF TECHNICAL NEGOTIATIONS THE AIR FORCE
UPDATED ITS EVALUATION AND CONCLUDED THAT THE HONEYWELL PROPOSAL, AS
REVISED DURING NEGOTIATIONS, MERITED A HIGHER TECHNICAL RATING THAN
GENERAL ELECTRIC. THE GENERAL REASONS FOR THIS CONCLUSION WERE REVIEWED
AT OUR REQUEST IN AN INDEPENDENT REVIEW BY THE NATIONAL BUREAU OF
STANDARDS (NBS). A GENERAL EXPLANATION AS TO RELATIVE TECHNICAL MERITS
OF YOUR PROPOSAL AS COMPARED TO HONEYWELL'S IS INCLUDED IN THE NBS
REPORT TO THIS OFFICE, A COPY OF WHICH IS ATTACHED AND INCORPORATED
HEREIN AS PART OF OUR DECISION. THE REPORT INCLUDES A DISCUSSION OF THE
PROTEST BY THE LINK DIVISION OF SINGER-GENERAL PRECISION, INC.; YOUR
PROTEST IS DISCUSSED ON THE LAST TWO PAGES OF THE REPORT.
IT IS ALSO NOTED THAT ON MARCH 30, 1971, YOUR COUNSEL PROVIDED OUR
OFFICE WITH A PAPER ENTITLED "PRIMARY SYSTEM REQUIREMENTS." THIS PAPER
LISTED 13 REQUIREMENTS OF THE AIR FORCE WORK STATEMENT WHICH YOU BELIEVE
SHOULD HAVE BEEN CONSIDERED IN THE AIR FORCE EVALUATION OF PROPOSALS.
OUR INQUIRY SHOWS THAT IN EVALUATING EACH PROPOSAL THE AIR FORCE DID IN
FACT CONSIDER WHETHER EACH OF THE "PRIMARY REQUIREMENTS" WHICH YOU LIST
WAS MET AND, NEVERTHELESS, THE AIR FORCE COULD NOT CONCLUDE THAT YOUR
TECHNICAL PROPOSAL WAS SUPERIOR TO THAT OF HONEYWELL.
FOR THE REASON STATED, WE SEE NO BASIS FOR CONCLUDING THAT THE AIR
FORCE FAILED TO UTILIZE THE CRITERIA SET FORTH IN THE REQUEST FOR
PROPOSALS IN SELECTING THE CONTRACTOR, AND, THEREFORE, YOUR PROTEST IS
DENIED.
AS REQUESTED, A COPY OF OUR DECISION IN THIS MATTER TO LINK IS
ENCLOSED.
HONORABLE ELMER B. STAATS
COMPTROLLER GENERAL OF THE UNITED STATES
GENERAL ACCOUNTING OFFICE
441 G STREET, N.W.
WASHINGTON, D.C. 20548
DEAR MR. STAATS:
ON 12 APRIL, MR. PAUL DEMBLING OF YOUR OFFICE CALLED THE DIRECTOR OF
THE CENTER FOR COMPUTER SCIENCES AND TECHNOLOGY TO REQUEST ASSISTANCE IN
EVALUATING THE TECHNICAL MERITS OF BID PROTESTS (NO. B171609) BY THE
LINK DIVISION OF SINGER-GENERAL PRECISION, INC. AND THE GENERAL
ELECTRIC COMPANY RELATIVE TO THE UNITED STATES AIR FORCE'S PROCUREMENT
OF AN UNDERGRADUATE NAVIGATOR TRAINING SYSTEM. IN RESPONSE TO THIS
REQUEST, THREE NBS SENIOR STAFF MEMBERS WERE ASSIGNED TO ASSIST YOUR
OFFICE IN RESOLVING THE TECHNICAL ISSUES RELATED TO THE BID PROTESTS.
THE FINDINGS AND CONCLUSIONS OF THE NBS TEAM ARE PROVIDED IN THIS
LETTER.
THE AIR FORCE, IN ORDER TO PROVIDE MORE EFFECTIVE TRAINING FOR
NAVIGATORS IN THE OPERATIONAL COMMANDS HAS INITIATED A PROGRAM TO
DEVELOP AND ACQUIRE A GROUND SIMULATOR TO SUPPORT THE TRAINING OF
UNDERGRADUATE NAVIGATORS IN THE BASIC SKILLS, KNOWLEDGE AND DISCIPLINE
REQUIRED TO OPERATE PRESENT AND FUTURE NAVIGATION EQUIPMENT.
A REQUEST FOR PROPOSALS WAS ISSUED ON APRIL 1, 1970 TOGETHER WITH A
COMPREHENSIVE STATEMENT OF WORK ENTITLED "UNDERGRADUATE NAVIGATOR
TRAINING SYSTEM (UNTS), PHASE I - GROUND SIMULATOR, SYSTEM 683V."
PROPOSALS WERE SUBMITTED BY LINK DIVISION OF SINGER-GENERAL PRECISION,
INC., GENERAL ELECTRIC COMPANY, MARINE SYSTEMS CENTER OF HONEYWELL,
INC., CONDUCTRON, INC., AND LING-TEMPCO VOUGHT-ELECTRONICS. PRELIMINARY
NEGOTIATIONS WERE INITIATED WITH LINK, GENERAL ELECTRIC AND HONEYWELL.
DURING THIS PROCESS HONEYWELL REVISED ITS TECHNICAL PROPOSAL.
ON 14 JANUARY 1971, THE LINK DIVISION OF SINGER-GENERAL PRECISION,
INC. SUBMITTED TO YOUR OFFICE A BID PROTEST, NO. B-171609, WHICH WAS
SUBSEQUENTLY EXPANDED IN FURTHER CORRESPONDENCE. THE LINK DIVISION'S
BASIC ARGUMENT WAS THAT IN CERTAIN CRITICAL HIGH COST AREAS THE AIR
FORCE STATEMENT OF WORK WAS OPEN TO SEVERAL INTERPRETATIONS. THEY
REQUESTED AN INDEPENDENT EXAMINATION TO DETERMINE WHETHER, IN A FEW
CRITICAL AREAS, THE HONEYWELL BID WAS BASED ON THE SAME MINIMUM
REQUIREMENTS. NBS WAS REQUESTED TO PROVIDE AN INDEPENDENT TECHNICAL
EVALUATION OF FOUR AREAS OF QUESTION:
1. TIME REQUIRED FOR RADAR RANGE CHANGE.
2. INDEPENDENCE OF MOVEMENT BY INDIVIDUAL SIMULATED AIRCRAFT.
3. MINIMUM REQUIREMENT FOR RADAR RESOLUTION.
4. STUDENT VERSUS OPERATOR RATIO.
ON 16 APRIL 1971, NBS STAFF MEMBERS WERE BRIEFED AT YOUR OFFICE BY
REPRESENTATIVES OF LINK AND HONEYWELL AT WHICH TIME THE GENERAL
CHARACTERISTICS OF THEIR RESPECTIVE OFFERINGS WERE REVIEWED. FOLLOWING
THIS MEETING, NBS STAFF MEMBERS, ACCOMPANIED BY MR. VINCENT LABELLA OF
YOUR OFFICE, VISITED THE AIR FORCE SYSTEMS COMMAND, AERONAUTICAL SYSTEMS
DIVISION, WRIGHT-PATTERSON AIR FORCE BASE. THE TEAM EXAMINED AND
COMPARED CONTRACTUAL DOCUMENTS PERTINENT TO THESE FOUR ISSUES AND
CONFERRED WITH THE RESPONSIBLE AIR FORCE REPRESENTATIVES TO DETERMINE
THE VALIDITY OF THE LINK-SINGER ALLEGATIONS.
1. TIME REQUIRED FOR RADAR RANGE CHANGE.
THE STATEMENT OF WORK STIPULATES "THE DISPLAY SHALL MAINTAIN A REAL
TIME PRESENTATION WHEN CHANGING A RANGE SELECTION." LINK HAS STATED THAT
THE AIR FORCE HAS TAKEN THE POSITION THAT NO DISCERNABLE DIFFERENCE FROM
OPERATIONAL TIME IS THE MEANING OF REAL TIME AND THAT A 0.2 SECOND TIME
DELAY WAS MINIMALLY COMPLIANT WITH AIR FORCE REQUIREMENTS. OUR REVIEW
HAS ESTABLISHED THAT HONEYWELL HAS PROPOSED A TIME DELAY OF 0.167
SECONDS FOR WORST CASE CONDITIONS WHICH IS LESS THAN THE DELAY PROPOSED
BY LINK. THEREFORE, IN THIS AREA WE FEEL THAT FROM AN ENGINEERING POINT
OF VIEW THE HONEYWELL PROPOSAL EXCEEDS THE REQUIREMENTS AS REPRESENTED
BY LINK.
2. INDEPENDENCE OF MOVEMENT BY INDIVIDUAL SIMULATED AIRCRAFT.
THE STATEMENT OF WORK REQUIRES THAT EACH OF THE 46 STUDENT NAVIGATORS
BE ABLE TO MAINTAIN AN INDEPENDENT FLIGHT PATH AS A LEAD NAVIGATOR OVER
A MINIMUM GAMING AREA OF 1250 BY 1250 NAUTICAL MILES.
THE HONEYWELL PROPOSAL PROVIDES, IN PERTINENT PART, THAT EACH STUDENT
NAVIGATOR CAN MAINTAIN AN INDEPENDENT FLIGHT PATH OVER ANY PORTION OF
THE CONTINENTAL UNITED STATES AND PROVIDES FOR TESTING THIS CAPABILITY
BY SIMULATING 46 INDEPENDENT FLIGHT PATHS SIMULTANEOUSLY. THE MATERIAL
REVIEWED DID NOT INDICATE THAT HONEYWELL'S PROPOSAL AS NEGOTIATED
OFFERED ANY FORM OF CORRIDOR APPROACH WHICH WOULD RESTRICT FREEDOM OF
SIMULATED AIRCRAFT MOVEMENT AS HAD BEEN THE CASE IN HONEYWELL'S INITIAL
PROPOSAL. WE BELIEVE THAT THE HONEYWELL PROPOSAL EXCEEDS THE
REQUIREMENTS OF THE STATEMENT OF WORK, AND MEETS THE DESIRED MAXIMUM
AREA COVERAGE.
3. MINIMUM REQUIREMENT FOR RADAR RESOLUTION.
THE STATEMENT OF WORK STIPULATES THAT THE SIMULATOR SHALL PROVIDE
RANGE AND AZIMUTH RESOLUTION THE SAME AS THE AN/APQ-122(V)7 RADAR FOR
BOTH SHORT AND LONG RANGE FIXING. IN ADDITION IT STATES, "(THE
RESOLUTION OF THE AN/APQ-122(V)7 AT RANGES OF 30 NAUTICAL MILES OR LESS
IS APPROXIMATELY 150 FEET IN RANGE)."
IN ANSWER TO BIDDER'S QUESTIONS DATED 10 APRIL 1970, THE AIR FORCE
CLARIFIED THE REQUIREMENTS FOR RADAR RESOLUTION BY THE FOLLOWING
STATEMENT: "THE DIGITAL RADAR LANDMASS SIMULATION SYSTEM RESOLUTION
SHALL BE AT LEAST 250 FEET. THE DATA PROVIDED WITH THE DRLM SHALL BE AT
LEAST EQUAL TO THE AMOUNT OF DATA CONTAINED IN THE MULTICOLORED
TRANSPARENCIES. ANY MEANS OF DATA ENCODING AND ANY DATA SOURCE IS
ACCEPTABLE PROVIDED THE AMOUNT OF DETAILED INFORMATION IS AT LEAST THE
SAME AS WOULD BE PROVIDED THROUGH DIGITIZING THE MULTICOLORED
TRANSPARENCY AND WOULD THEREBY PROVIDE THE SAME LEVEL OF RADAR DISPLAY.
IT IS DESIRABLE THAT THE DIGITAL RADAR LANDMASS DATA HAVE THE SAME
RESOLUTION AS THE SYSTEM (250 FEET). THE RADAR SCOPE PROVIDED IN THE
UNT GROUND SIMULATOR SHALL HAVE IDENTICAL PERFORMANCE CAPABILITIES AS
THE SCOPE USED IN THE AIRCRAFT. SINCE THE SCOPE HAS RESOLUTION
CAPABILITY OF APPROXIMATELY 150 FEET, IT IS DESIRABLE THAT THE DIGITAL
RADAR LANDMASS SYSTEM PROVIDE THE SAME LEVEL OF RESOLUTION CAPABILITY,
BUT THE REQUIREMENT IS AT LEAST 250 FEET RESOLUTION."
A FURTHER CLARIFICATION OF RESOLUTION REQUIREMENTS WAS PROVIDED TO
BOTH HONEYWELL AND LINK WHICH CLEARLY INDICATED THAT THE SIMULATOR MUST
BE CAPABLE OF ACCURATELY DEFINING EACH 250 FOOT INCREMENT WITHIN THE
GAMING AREA AND THAT THE DATA STORAGE EQUIPMENT DESIGNED FOR THE
SIMULATOR MUST NOT BE BASED ON THE POORER LEVEL OF DETAIL CONTAINED IN
CERTAIN PRESENTLY AVAILABLE TRANSPARENCIES BUT MUST BE CAPABLE OF
HANDLING AND PROCESSING THE HIGHER (250 FOOT) RESOLUTION DATA EXPECTED
TO BE AVAILABLE IN THE FUTURE. IT FURTHER CLARIFIES THE REQUIREMENT
THAT THE PROCESSING EQUIPMENT MUST BE CAPABLE OF PROCESSING EACH
RESOLUTION ELEMENT ALONG THE LINE SWEEP WHERE THE TOTAL ELEMENTS PER
LINE SWEEP IS DETERMINED BY THE RADAR RANGE DIVIDED BY THE RESOLUTION.
THE REQUIREMENT FOR RESOLUTION IS REITERATED AT 250 FEET FOR RANGES UP
TO 30 NAUTICAL MILES AND 300 FEET AT A RANGE OF 50 NAUTICAL MILES.
NEITHER THE STATEMENT OF WORK NOR THE AIR FORCE CLARIFICATION IDENTIFIES
THE RANGE RESOLUTION (IN FEET) OF THE AN/APQ-122(V)7 AT THE RANGES OF
100 OR 240 NAUTICAL MILES.
AN EXAMINATION OF THE SPECIFICATION REQUIREMENTS FOR THE
AN/APQ-122(V)7 RADAR SET ALSO FAILED TO REVEAL ANY DIRECTLY STATED
REQUIREMENTS FOR RANGE RESOLUTION ON THE 100 AND 240 NAUTICAL MILE
RANGES, HOWEVER, THE PULSE DURATION, VIDEO BANDWIDTH AND OTHER SPECIFIED
CHARACTERISTICS OF THE RADAR INFER A RANGE RESOLUTION ON THE ORDER OF
2000 FEET. THE AIR FORCE CONCURRED IN THIS ASSESSMENT BASED ON THEIR
KNOWLEDGE OF THE SPECIFICATIONS FOR THE AN/APQ-122(V)7 RADAR. BASED ON
THESE FACTS, WE BELIEVE THAT A REASONABLE ASSESSMENT OF THE REQUIRED
SIMULATOR RADAR RANGE RESOLUTION WOULD BE AS FOLLOWS:
RADAR RANGE (N MI) RANGE RESOLUTION (FT)
3-30 250
8 250
50 300
100 2000
240 2000
BOTH LINK AND HONEYWELL PROPOSE SIMULATOR RANGE RESOLUTION
PERFORMANCE IN ACCORDANCE WITH THE ABOVE TABULATION. WE BELIEVE THAT
BOTH ARE FULLY IN ACCORD WITH THE AIR FORCE'S EXPRESSED AND IMPLIED
REQUIREMENTS WITH RESPECT TO RANGE RESOLUTION. BOTH HAVE INDICATED THAT
THEY WOULD BE CAPABLE OF PROCESSING AND PRESENTING DATA FROM A
"CHECKERBOARD" DATA BASE AT THE 250 FOOT RESOLUTION FOR RANGES UP TO 30
N MI AND IN ACCORDANCE WITH THE TABULATION SHOWN ABOVE FOR GREATER
RANGES.
WITH RESPECT TO THE PROCESSING OF THESE DATA TO GENERATE THE
SIMULATED DISPLAY INFORMATION, THERE IS A HIGH DEGREE OF PARALLELISM IN
THE TECHNICAL APPROACHES PROPOSED BY BOTH LINK AND HONEYWELL. BOTH
CONTEMPLATE THE USE OF SPECIAL PURPOSE, HIGH SPEED, PARALLEL PATH
PROCESSORS TO SOLVE A RADAR EQUATION NOT SPECIFICALLY STATED IN THE
STATEMENT OF WORK AS NECESSARY TO CONVERT THE DIGITAL INFORMATION IN THE
LANDMASS DATA BASE STORAGE TO RADAR DISPLAY INFORMATION FOR THE
SIMULATOR. HONEYWELL PROPOSES A MAXIMUM PROCESSING TIME ON THE ORDER OF
FOUR OR FIVE MICROSECONDS WITH TASK OVER-LAPPING TO PROVIDE A THROUGHPUT
RATE OF 600 NANOSECONDS PER RESOLUTION ELEMENT (E.G., 250 X 250 FEET)
AND LINK PROPOSES A MAXIMUM PROCESSING AND THROUGHPUT RATE OF ABOUT 1000
NANOSECONDS FOR EACH ELEMENT.
BOTH BIDDERS PROCESS IN SUCH A WAY AS TO ACCESS ALL OF THE DATA
AVAILABLE IN THE DATA BASE WHICH IS PERTINENT TO A GIVEN SIMULATED
DISPLAY SITUATION. BOTH WOULD MISS DATA WHICH MIGHT BE SEEN BY THE
OPERATIONAL RADAR AT SHORT RANGES ON ACCOUNT OF THE DIFFERENCE BETWEEN
THE 150 FOOT RANGE RESOLUTION CAPABILITY OF THE OPERATIONAL RADAR AND
THE 250 FOOT RANGE RESOLUTION OF THE DISPLAY DATA BASE. IN PROCESSING
THE DATA FOR DISPLAY, LINK TAKES INTO ACCOUNT THE PHENOMENON OF PULSE
STRETCHING WHILE HONEYWELL DOES NOT. THIS DETRACTS SLIGHTLY FROM THE
REALISM OF THE SIMULATED DATA DISPLAY. IN OUR OPINION, THE SIMULATION
OF THIS PHENOMENON REQUIRES ONLY THE ADD-ON OF A SOFTWARE PACKAGE AND
SHOULD NOT REPRESENT A MAJOR COST ITEM.
LINK HAS RAISED THE QUESTION OF WHETHER HONEYWELL MIGHT BE EMPLOYING
COARSER RESOLUTION ELEMENTS (LARGER THAN 250 X 250 FEET) IN THE LANDMASS
DATA STORAGE BASE AND INTERPOLATING BETWEEN THESE POINTS TO DEVELOP
APPARENTLY HIGHER RESOLUTION DISPLAY DATA. THIS IS NOT THE CASE. THE
HONEYWELL PROPOSAL CLEARLY INDICATES THAT THE BASIC LANDMASS REFLECTANCE
DATA BASE WILL BE STORED IN 250 X 250 FOOT ELEMENTS. BOTH BIDDERS
EMPLOY A FORM OF DATA COMPACTION WHICH REQUIRES THE EQUIVALENT OF
INTERPOLATION TO DECOMPACT THE RECORDED ELEVATION INFORMATION IN THE
LANDMASS DATA STORAGE BASE.
4. STUDENT VERSUS OPERATOR RATIO.
THE STATEMENT OF WORK STIPULATES THAT THE BIDDER SHALL IDENTIFY THE
NUMBERS OF OPERATOR STATIONS AND OPERATORS REQUIRED FOR THE 46 STUDENT
SIMULATOR SYSTEM.
BOTH LINK AND HONEYWELL HAVE PROPOSED SYSTEM CONFIGURATIONS IN WHICH
A COMPLEX OF FOUR STUDENTS IS HANDLED BY ONE OPERATOR. THE LINK
PROPOSAL INCLUDES FACILITIES FOR PERMITTING ONE OPERATOR TO OPTIONALLY
CONTROL EIGHT OR TWELVE STUDENTS. HONEYWELL DOES NOT OFFER THIS
OPTIONAL CHOICE OF STUDENT OPERATOR RATIOS.
THE AIR FORCE HAS INDICATED THAT SINCE MANNING WOULD BE REQUIRED ON
THE 4 TO 1 RATIO FOR EITHER SYSTEM, THE OPTIONAL CAPABILITY TO MODIFY
THE STUDENT-OPERATOR RATIO WOULD REPRESENT LITTLE FINANCIAL BENEFIT.
THE APOLLO SYSTEMS DEPARTMENT OF THE GENERAL ELECTRIC COMPANY WAS ONE
OF THE CONTRIBUTING BIDDERS FOR THIS PROCUREMENT AND ON 12 MARCH 1971,
SUBMITTED A PROTEST LETTER TO YOUR OFFICE QUESTIONING THE PROPOSED
CONTRACT AWARD TO HONEYWELL. THEIR BASIC OBJECTIONS ADDRESS TWO POINTS:
1) THEIR PROPOSAL WAS RATED HIGHER BY THE AIR FORCE THAN HONEYWELL'S
INITIAL PROPOSAL, AND 2) THE FINAL PRICE OFFERED BY HONEYWELL WAS NOT
SUFFICIENTLY LOWER THAN THE GENERAL ELECTRIC SUBMISSION TO JUSTIFY AN
AWARD TO HONEYWELL.
THE GENERAL ELECTRIC COMPANY'S TECHNICAL PROPOSAL WAS REVIEWED AND IT
IS CONCLUDED THAT 1) THE DRLMS STORAGE CAPACITY WAS INADEQUATE AND 2)
THIS INADEQUATE STORAGE CAPACITY COUPLED WITH THE PROPOSED RADAR SCAN
PROCESSING WILL NOT PROVIDE THE REQUIRED DEGREE OF REAL TIME RADAR
PRESENTATION REALISM AS COMPARED TO LINK AND HONEYWELL APPROACH. FOR
EXAMPLE, THE ORIGINAL HONEYWELL SYSTEM DESIGN WAS DEEMED DEFICIENT IN
SEVERAL AREAS INCLUDING INADEQUATE RESOLUTION AND LIMITATIONS IMPOSED BY
THE 2400 BY 80 MILE CORRIDOR CONCEPT OF ON LINE DATA. HOWEVER, DURING
THE NEGOTIATION PHASE THE CORRIDOR CONCEPT WAS REPLACED BY A SYSTEM
WHEREIN THE ENTIRE CONTINENTAL UNITED STATES DATA BASE AT ACCEPTABLE
RESOLUTION IS ON LINE TO EACH STUDENT NAVIGATOR. THIS MODIFICATION IN
THE HONEYWELL PROPOSAL ESTABLISHED A REVISED HIGHER RATING FOR ITS
TECHNICAL EVALUATION THAN FOR THE GENERAL ELECTRIC PROPOSAL.
A REVIEW OF THE DOCUMENTATION PROVIDED BY THE AIR FORCE COUPLED WITH
OUR EVALUATION OF THE THREE TECHNICAL PROPOSALS, GAVE US NO INDICATION
THAT VARYING OR DIFFERENT FORMAL GUIDANCE HAD BEEN PROVIDED TO THE
BIDDERS.
OUR ANALYSIS OF THE AIR FORCE STATEMENT OF WORK AND TECHNICAL
PROPOSAL DOCUMENTS INDICATES THAT AN ACCEPTABLE UNDERGRADUATE NAVIGATOR
TRAINING SYSTEM CAN BE PROVIDED BY THE MARINE SYSTEMS CENTER OF
HONEYWELL, INC.
MY STAFF DID NOT EVALUATE THE FINANCIAL SUBMISSIONS OF COMPETING
BIDDERS. AS A RESULT, THIS ANALYSIS DOES NOT ADDRESS THE PROBLEM OF
WHETHER FINANCIAL SUBMISSIONS MATCHED PROPOSED SYSTEM DESIGN.
IT WAS A PLEASURE TO PROVIDE TECHNICAL ASSISTANCE TO YOUR OFFICE.
PLEASE CONTACT ME IF ADDITIONAL ASSISTANCE IS DESIRED ON THE RESOLUTION
OF THIS CONTESTED BID SELECTION.
SINCERELY,
DR. L. M. BRANSCOMB
DIRECTOR
B-172052, MAY 12, 1971
CONTRACTS - BID RESPONSIVENESS - QUALIFICATIONS
DECISION HOLDING THAT AWARD OF A CONTRACT TO MORRISON INDUSTRIAL
EQUIPMENT CO., FOR A BATTERY OPERATED FORKLIFT TRUCK ON A BRAND NAME OR
EQUAL BASIS SHOULD NOT HAVE BEEN MADE AND SHOULD THEREFORE BE CANCELLED.
EQUAL BASIS SHOULD NOT HAVE BEEN MADE AND SHOULD THEREFORE BE CANCELLED.
WHERE THE INSTANT CONTRACT INCLUDED A TRADE-IN ALLOWANCE ON A USED
POWER WORKLIFT ON AN "AS IS" AND "WHERE IS" BASIS AND SUCCESSFUL SOLE
BIDDER MORRISON QUALIFIED ITS $800 TRADE-IN ALLOWANCE BY REQUIRING THAT
THE EQUIPMENT BE IN "RUNNING CONDITION", THE BID WAS RESPONSIVE,
NOTWITHSTANDING THE FACT THAT THE VA HAD RESERVED THE RIGHT TO DISREGARD
ANY TRADE-IN OFFER AND IN EFFECT AWARD A CONTRACT FOR THE FORKLIFT TRUCK
ITEM ALONE.
TO MR. JOHNSON:
WE REFER TO LETTER 134G, DATED FEBRUARY 19, 1971, FROM THE DIRECTOR,
SUPPLY SERVICE, DEPARTMENT OF MEDICINE AND SURGERY, AND SUBSEQUENT
DOCUMENTATION FURNISHED ON MARCH 17, 31, AND APRIL 9, 1971.
THE FOREGOING RELATES THE CLAIM OF MORRISON INDUSTRIAL EQUIPMENT CO.
FOR A CONTRACT PRICE ADJUSTMENT AS A RESULT OF A MISTAKE IN BID ALLEGED
AFTER THE AWARD OF ORDER FOR SUPPLIES OR SERVICES (CONTRACT) NO. 1519 BY
THE SUPPLY DIVISION, VETERANS ADMINISTRATION HOSPITAL, BATTLE CREEK,
MICHIGAN.
THE INVITATION FOR BIDS (IFB) CALLED FOR A BATTERY OPERATED FORKLIFT
TRUCK "W/24 VOLT BATTERY" UNDER A BRAND NAME OR EQUAL REQUIREMENT
SPECIFYING CLARK EQUIPMENT COMPANY MODEL NST 25. A TRADE-IN ALLOWANCE
ALSO WAS SOLICITED ON A USED POWER WORKLIFT WITH BATTERY AND CHARGER.
EIGHT SOURCES WERE SOLICITED, BUT ONLY MORRISON SUBMITTED A BID. ON
DECEMBER 16, 1970, MORRISON WAS AWARDED A CONTRACT IN THE TOTAL AMOUNT
OF $5,215, COMPUTED ON THE BASIS OF THE $6,015 UNIT PRICE FOR THE NEW
ITEM LESS THE $800 OFFERED AS A TRADE-IN ALLOWANCE ON THE OLD EQUIPMENT.
SUBSEQUENT TO THE AWARD, MORRISON INFORMED THE VETERANS ADMINISTRATION
CONTRACTING OFFICIALS OF AN ERROR IN BID IN THAT THE $1,127 COST OF THE
BATTERY TO BE USED AS THE FORKLIFT TRUCK POWER SUPPLY HAD NOT BEEN
INCLUDED IN THE BID PRICE.
WITH ITS BID MORRISON SUBMITTED A LETTER WHICH MADE REFERENCE TO
MORRISON QUOTATION NO. 5811. THE QUOTATION WAS NOT RECEIVED WITH THE
BID. HOWEVER, AS A PART OF THE EVIDENCE FURNISHED TO SUPPORT THE ERROR
IN BID, MORRISON HAS SUBMITTED A COPY OF THE QUOTATION WHICH INDICATES A
PRICE OF $6,015 FOR THE BRAND NAME TRUCK AND A PRICE OF $1,127 FOR A
BATTERY, TOTALING $7,142.
FOR REASONS HEREINAFTER STATED, THE PURPORTED CONTRACT SHOULD BE
CANCELED WITHOUT LIABILITY TO MORRISON. IT IS THEREFORE UNNECESSARY TO
CONSIDER THE ERROR IN BID QUESTION.
PARAGRAPH 1 OF THE SUPPLEMENTARY GENERAL PROVISIONS OF THE IFB
CONTAINS THE FOLLOWING LANGUAGE CONCERNING THE TRADE-IN EQUIPMENT UPON
WHICH BIDDERS WERE TO SUBMIT PRICES:
"TRADE-IN EQUIPMENT - BIDS ARE BEING SOLICITED WITH PROVISIONS FOR
TRADE-IN ALLOWANCE OF USED EQUIPMENT. THIS EQUIPMENT IS OFFERED 'AS IS'
AND 'WHERE IS' AND MUST BE REMOVED BY THE CONTRACTOR AT HIS OWN EXPENSE
WITHIN TEN DAYS FROM DATE OF DELIVERY OF NEW EQUIPMENT. BIDDERS ARE
INVITED TO INSPECT THIS EQUIPMENT MONDAYS THROUGH FRIDAYS EXCEPT
HOLIDAYS, BETWEEN THE HOURS OF 8:00 A.M. AND 4:00 P.M. BIDDERS ARE
INSTRUCTED TO SUBMIT SEPARATE BID PRICES ON NEW EQUIPMENT AND A SEPARATE
BID ON THE TRADE-IN EQUIPMENT. THE VETERANS ADMINISTRATION RESERVES THE
RIGHT TO MAKE NO AWARD ON TRADE-IN OFFERS IF IT IS DETERMINED TO BE TO
THE BEST INTEREST OF THE GOVERNMENT TO SELL SUCH EQUIPMENT UNDER
SEPARATE SOLICITATION." HOWEVER, THE MORRISON LETTER WHICH ACCOMPANIED
THE BID SETS FORTH THE FOLLOWING CONTINGENCY OR QUALIFICATION OF THE
$800 TRADE-IN ALLOWANCE:
"IN ORDER TO OFFER YOU THE HIGHEST TRADE-IN POSSIBLE, OUR OFFER IS
CONTINGENT UPON THE EQUIPMENT BEING RECEIVED IN RUNNING CONDITION AND IN
THE SAME GENERAL REPAIR AS REPORTED IN OUR SURVEY REPORT. ANY VARIATION
WILL ALTER THE TRADE-IN VALUE ACCORDINGLY. THIS OFFER IS OPEN FOR YOUR
ACCEPTANCE FOR 30 DAYS."
THIS QUALIFICATION WAS CONTRARY TO THAT PORTION OF THE IFB, QUOTED
ABOVE, ADVISING BIDDERS THAT THE TRADE-IN EQUIPMENT WAS OFFERED "AS IS"
AND "WHERE IS." WE HAVE HELD THAT THE SALE OF EQUIPMENT ON SUCH BASIS
CONSTITUTES AN ENFORCEABLE DISCLAIMER OF WARRANTY BY WHICH THE
GOVERNMENT PROTECTS ITSELF. SEE 45 COMP. GEN. 675, 677 (1966). THUS,
THE IFB PLACED THE RISK OF THE CONDITION OF THE PROPERTY UPON THE
BIDDER. WHERE, AS HERE, A BIDDER SUBMITS A LETTER WITH THE BID WHICH
DISCUSSES THE REQUIREMENTS OF THE SPECIFICATIONS, HE IS TAKING THE RISK
THAT THE LETTER MAY HAVE QUALIFIED THE BID WITH RESPECT TO CERTAIN
MATERIAL REQUIREMENTS. B-167891, OCTOBER 30, 1969. THE EFFECT OF THE
MORRISON LETTER WAS TO QUALIFY THE BID WITH RESPECT TO THE CONDITION OF
THE TRADE-IN EQUIPMENT.
IN VIEW THEREOF, THE BID ON THE TRADE-IN EQUIPMENT WAS NONRESPONSIVE
WE ARE NOT UNMINDFUL THAT THE ABOVE-CITED IFB PROVISION RESERVED IN
THE VETERANS ADMINISTRATION THE RIGHT TO DISREGARD ANY TRADE-IN OFFER
AND, IN EFFECT, AWARD A CONTRACT FOR THE FORKLIFT TRUCK ITEM ALONE. WE
NOTE, HOWEVER, THAT THE MORRISON LETTER STATED FURTHER:
"AT THE REQUEST OF MR. TOM ZELINSKY, OUR SALES REPRESENTATIVE, WE
WILL ALLOW YOU THE FOLLOWING TRADE-IN ALLOWANCE TO APPLY AGAINST THE
PURCHASE OF THE NEW CLARK LIFT TRUCK PER OUR QUOTATION #5811.
"CLARK MODEL AND S/N: 20TTF 109-QE-244
"PRICE $800.00 WITH BATTERY AND CHARGER" AS STATED, SUPRA, THE
QUOTATION FORM WAS NOT RECEIVED WITH THE BID. NEVERTHELESS, WE REGARD
THIS STATEMENT AS GIVING RISE TO AN AMBIGUITY WHICH FURTHER QUALIFIED
THE MORRISON BID. THE PRACTICAL EFFECT OF THAT STATEMENT WAS TO OFFER
THE VETERANS ADMINISTRATION THE DESIRED TRUCK IN ACCORDANCE WITH A
SEPARATE QUOTATION FORM, IN ADDITION TO THE IFB SPECIFICATIONS, WHICH
MAY OR MAY NOT HAVE COMPLIED WITH THE SPECIFICATIONS SET FORTH IN THE
INVITATION. SEE 50 COMP. GEN. ___ (B-169813, JULY 6, 1970), AND CASES
CITED THEREIN. SINCE BIDS IN ADVERTISED PROCUREMENTS MUST CONFORM TO
THE MATERIAL REQUIREMENTS OF THE INVITATION AT THE TIME BIDS ARE OPENED,
NO FURTHER INQUIRY BY THE CONTRACTING OFFICE TO DETERMINE THE FORM'S
CONTENTS WOULD HAVE BEEN PERMISSIBLE. SEE B-171417, MARCH 9, 1971.
FURTHER, WHERE A BID IS AMBIGUOUS AS TO WHETHER THE PRODUCT OFFERED
COMPLIES WITH THE ADVERTISED SPECIFICATIONS, IT MUST BE REJECTED AS
NONRESPONSIVE. SEE B-170006, AUGUST 17, 1970. IN THE CIRCUMSTANCES, AN
AWARD SHOULD NOT HAVE BEEN MADE TO MORRISON AND IT SHOULD THEREFORE BE
CANCELED.
THE ENCLOSED PAPERS ARE RETURNED AS REQUESTED.
B-172117, MAY 12, 1971
CIVILIAN EMPLOYEE - ERRONEOUS PAYMENT OF PAY - WAIVER OF REFUND
SUSTAINING PRIOR DECISION DENYING REQUEST OF AN EMPLOYEE OF THE U.S.
ARMY COMBAT DEVELOPMENTS COMMAND, FT. BELVOIR, VA., FOR A WAIVER UNDER 5
U.S.C. 5584 OF AN ERRONEOUS PAYMENT OF PAY FOR THE PERIOD FROM JULY 28,
1968, THROUGH FEBRUARY 28, 1970.
BY VIRTUE OF AN ADMINISTRATIVE ERROR EMPLOYEES PAYROLL DEDUCTION FOR
HEALTH INSURANCE PREMIUMS WAS NOT MADE AND HEALTH INSURANCE DEDUCTIONS
WERE NOT SHOWN ON HIS EARNINGS AND LEAVE STATEMENT. EMPLOYEE'S CLAIM
THAT HE WAS FREE OF FAULT IN NOT BEING AWARE OF THE ERROR BECAUSE THE
SMALL OVERPAYMENT WAS COINCIDENT WITH A SALARY INCREASE WILL NOT STAND
BECAUSE THE ERROR WAS ALSO INDICATED BY OMISSION OF ANY DEDUCTION FOR
HEALTH INSURANCE BENEFITS ON HIS EARNING STATEMENT. FURTHERMORE, AFTER
EMPLOYEE NOTIFIED THE AGENCY ACCOUNTING OFFICE OF THE OMISSION (MET BY
THEIR REPLY THAT SUCH OMISSION WAS OF A TEMPORARY NATURE AND A COMMON
OCCURRENCE IN INTERAGENCY TRANSFERS), HIS FAILURE AFTER A REASONABLE
LENGTH OF TIME TO ACTIVELY PURSUE THE MATTER OF POSSIBLE ERROR WHEN THE
OMISSION CONTINUED MAKES HIM PARTIALLY AT FAULT AND INELIGIBLE FOR
WAIVER.
TO MR. JOHN A. GILBERTO:
THIS IS IN REPLY TO YOUR LETTER OF NOVEMBER 23, 1970, REQUESTING
RECONSIDERATION OF THE DENIAL OF YOUR REQUEST FOR WAIVER UNDER 5 U.S.C.
5584, AS ADDED BY PUBLIC LAW 90-616, OF AN ERRONEOUS PAYMENT OF PAY FOR
THE PERIOD FROM JULY 28, 1968, THROUGH FEBRUARY 28, 1970, AS AN EMPLOYEE
OF THE U.S. ARMY COMBAT DEVELOPMENTS COMMAND, FORT BELVOIR, VIRGINIA.
THE FACTS SURROUNDING THE OVERPAYMENT AS SET FORTH IN OUR CLAIMS
DIVISION LETTER OF NOVEMBER 2, 1970, TO THE U.S. ARMY FINANCE CENTER,
ARE AS FOLLOWS:
"THE RECORD SHOWS THAT MR. GILBERTO WAS TRANSFERRED TO FORT BELVOIR
IN JULY 1968 AND EXECUTED THE APPROPRIATE FORM FOR CONTINUING COVERAGE
IN A PREVIOUSLY SELECTED HEALTH INSURANCE PLAN. HOWEVER, DUE TO AN
ADMINISTRATIVE ERROR, THE NECESSARY DOCUMENTATION TO EFFECT PAYROLL
DEDUCTION FOR HEALTH INSURANCE PREMIUMS WAS NOT MADE. THE EMPLOYEE'S
COVERAGE REMAINED IN EFFECT. THE EARNING AND LEAVE STATEMENTS FURNISHED
TO THE EMPLOYEE FOR EACH PAY PERIOD DID NOT SHOW A DEDUCTION FOR HEALTH
INSURANCE PREMIUMS AND HIS FIRST PAY CHECK (ONE-HALF PAY PERIOD)
REFLECTED AN INCREASE OF ONE-HALF OF HIS SHARE OF THE PREMIUM OR $6.72.
HIS SUBSEQUENT BIWEEKLY PAY CHECKS REFLECTED INCREASES WHICH REPRESENTED
HIS FULL SHARE OF THE BIWEEKLY PREMIUMS. ON MARCH 3, 1970, MR. GILBERTO
CALLED THE CIVILIAN PAY SECTION AND INQUIRED AS TO THE REASON WHY HEALTH
INSURANCE DEDUCTIONS WERE NOT SHOWN ON HIS EARNINGS AND LEAVE STATEMENT.
THE ERROR WAS CORRECTED AND HEALTH INSURANCE DEDUCTIONS WERE RESUMED IN
PAY PERIOD BEGINNING FEBRUARY 29, 1970. HE WAS OVERPAID IN THE AMOUNT
OF $574.52 FROM JULY 28, 1968 THROUGH PAY PERIOD ENDING FEBRUARY 28,
1970." THAT LETTER DENIED YOUR REQUEST FOR WAIVER UPON A FINDING THAT
YOU WERE AT LEAST PARTIALLY AT FAULT WITH REGARD TO THE ERROR IN THAT
THE EARNINGS AND LEAVE STATEMENTS WHICH YOU RECEIVED INDICATING THAT NO
DEDUCTION HAD BEEN MADE FOR HEALTH INSURANCE WOULD HAVE CAUSED A
REASONABLE MAN TO INQUIRE AS TO WHETHER APPROPRIATE DEDUCTIONS WERE IN
FACT BEING MADE, WHICH YOU DID NOT.
YOU NOW SAY THAT UPON RECEIPT OF ONE OF YOUR FIRST FEW PAY CHECKS,
YOU NOTIFIED THE ACCOUNTING OFFICE OF THE FACT OF CERTAIN DATA OMISSIONS
FROM YOUR EARNING STATEMENT AND WERE INFORMED THAT IN CASES OF
INTERAGENCY TRANSFERS SUCH OMISSIONS WERE NOT UNCOMMON; ALSO THAT YOU
WERE TOLD THAT THE OMISSIONS WOULD BE SUPPLIED IN A FEW PAY PERIODS.
YOU FURTHER INDICATE THAT THE CLAIMS DIVISION'S CONCLUSION THAT YOU
SHOULD HAVE BEEN AWARE OF AN INCREASE BY THE AMOUNT OF THE INSURANCE
PREMIUM IN YOUR PAY CHECK IS NOT REALISTIC. YOU STATE:
"POINT 2 - AGAIN KEEPING IN MIND THAT MY TRANSFER WAS A PROMOTIONAL
TRANSFER, THE OBSERVATION THAT THE INCREASES IN EARNING STATEMENTS
SHOULD HAVE REVEALED THAT HEALTH INSURANCE PAYMENTS WERE NOT DEDUCTED IS
NOT CONSISTENT WITH THE FACTS. MY TRANSFER OCCURRED IN THE MIDDLE OF A
PAY-PERIOD.
THE 1ST EARNING STATEMENT REPRESENTED ONE WEEK'S EARNING, THE 2ND,
3RD, ETC., REPRESENTED A FULL PAY-PERIOD'S EARNING. IN THESE INSTANCES
DIFFERENT SALARY FIGURES WERE INVOLVED BECAUSE OF PROMOTION SALARY
INCREASE AND THE ENACTMENT OF FEDERAL PAY INCREASES."
THE REGULATIONS IMPLEMENTING PUBLIC LAW 90-616 AUTHORIZING THE WAIVER
OF OVERPAYMENTS OF PAY UNDER CERTAIN CIRCUMSTANCES ARE FOUND AT 4 CFR
91-93. SUBSECTION 91.5(5) OF THOSE REGULATIONS PROVIDES FOR WAIVER
WHENEVER:
"(B) COLLECTION ACTION UNDER THE CLAIM WOULD BE AGAINST EQUITY AND
GOOD CONSCIENCE AND NOT IN THE BEST INTERESTS OF THE UNITED STATES.
GENERALLY THESE CRITERIA WILL BE MET BY A FINDING THAT THE ERRONEOUS
PAYMENT OF PAY OCCURRED THROUGH ADMINISTRATIVE ERROR AND THAT THERE IS
NO INDICATION OF FRAUD, MISREPRESENTATION, FAULT OR LACK OF GOOD FAITH
ON THE PART OF THE EMPLOYEE OR ANY OTHER PERSON HAVING AN INTEREST IN
OBTAINING A WAIVER OF THE CLAIM. ANY SIGNIFICANT UNEXPLAINED INCREASE
IN AN EMPLOYEE'S PAY WHICH WOULD REQUIRE A REASONABLE MAN TO MAKE
INQUIRY CONCERNING THE CORRECTNESS OF HIS PAY ORDINARILY WOULD PRECLUDE
A WAIVER WHEN THE EMPLOYEE FAILS TO BRING THE MATTER TO THE ATTENTION OF
APPROPRIATE OFFICIALS. WAIVER OF OVERPAYMENTS OF PAY UNDER THIS
STANDARD NECESSARILY MUST DEPEND UPON THE FACTS EXISTING IN THE
PARTICULAR CASE. *** "
WE STATED IN B-165663, JUNE 11, 1969, WITH REGARD TO THE REQUIREMENT
THAT THERE BE NO INDICATION OF FAULT ON THE PART OF THE EMPLOYEE, THAT:
"WHETHER AN EMPLOYEE WHO RECEIVES AN ERRONEOUS PAYMENT IS FREE FROM
FAULT IN THE MATTER CAN ONLY BE DETERMINED BY A CAREFUL ANALYSIS OF ALL
PERTINENT FACTS, NOT ONLY THOSE GIVING RISE TO THE OVERPAYMENT BUT THOSE
INDICATING WHETHER THE EMPLOYEE REASONABLY COULD HAVE BEEN EXPECTED TO
HAVE BEEN AWARE THAT AN ERROR HAD BEEN MADE. IF IT IS ADMINISTRATIVELY
DETERMINED THAT A REASONABLE MAN, UNDER THE CIRCUMSTANCES INVOLVED,
WOULD HAVE MADE INQUIRY AS TO THE CORRECTNESS OF THE PAYMENT AND THE
EMPLOYEE INVOLVED DID NOT, THEN, IN OUR OPINION, THE EMPLOYEE COULD NOT
BE SAID TO BE FREE FROM FAULT IN THE MATTER AND THE CLAIM AGAINST HIM
SHOULD NOT BE WAIVED."
YOU CONTEND THAT AN EMPLOYEE SHOULD NOT BE EXPECTED TO NOTICE A
RELATIVELY SMALL OVERPAYMENT INITIALLY MADE ON A PAY CHECK WHICH ALSO
REFLECTS A SALARY INCREASE WHERE THE ERROR IS EVIDENCED ONLY BY THE
AMOUNT OF HIS PAY CHECK. HOWEVER, WE POINT OUT THAT YOU WERE FURNISHED
AN EARNING AND LEAVE STATEMENT EACH PAY PERIOD WHICH INDICATED THAT NO
DEDUCTION HAD BEEN MADE FOR HEALTH INSURANCE BENEFITS, WHICH YOU
NEVERTHELESS CONTINUED TO RECEIVE. THESE STATEMENTS ARE FURNISHED FOR
THE EXPRESS PURPOSE OF PERMITTING AN EMPLOYEE TO VERIFY THE DEDUCTIONS
BEING MADE FROM HIS SALARY. AS YOU NOW INDICATE, THEY DID SERVE THAT
PURPOSE. YOUR SPECIFIC STATEMENT IN THAT REGARD IS AS FOLLOWS:
" *** UPON RECEIPT OF MY 1ST, 2ND, AND/OR 3RD EARNING STATEMENT I
NOTIFIED THE APPROPRIATE FISCAL ACCOUNTING OFFICE OF THE OMISSION OF
CERTAIN DATA ON MY EARNING STATEMENT. I WAS INFORMED THAT ON
INTERAGENCY TRANSFERS THE DATA OMISSION WAS OF A TEMPORARY NATURE AND A
COMMON OCCURRENCE. ALSO, IT WOULD BE CORRECTED WITHIN SEVERAL PAY
PERIODS (I.E., MONTHS) AND WOULD NOT AFFECT ACTUAL CREDITS AND DEBITS
DOLLAR-WISE OR LEAVE-WISE. FURTHER, SINCE I HAD SIGNED THE NECESSARY
HEALTH SERVICE PLAN FORM UPON ARRIVAL TO MY NEW DUTY STATION I GAVE NO
FURTHER THOUGHT TO THE MATTER."
CONCERNING THE ABOVE STATEMENT, OUR VIEW IS THAT YOU SHOULD HAVE MORE
ACTIVELY PURSUED THE MATTER OF A POSSIBLE ERROR. AFTER A REASONABLE
PERIOD OF TIME, WHICH IN THIS INSTANCE WOULD HAVE BEEN A MATTER OF A FEW
PAY PERIODS, YOU SHOULD HAVE BECOME AWARE THAT THE OMISSION WAS MORE
THAN JUST THE ROUTINE DISRUPTION IN PAPERWORK ATTENDING AN INTERAGENCY
TRANSFER.
IN VIEW OF THE ABOVE, WHILE THERE IS NO INDICATION OF FRAUD OR
MISREPRESENTATION ON YOUR PART, WE FEEL THAT YOU WERE PARTIALLY AT FAULT
IN THE MATTER, AND DENIAL OF YOUR REQUEST FOR WAIVER MUST, THEREFORE, BE
SUSTAINED.
B-172640, MAY 12, 1971
BID PROTEST - DAVIS BACON ACT REINSTATED - AWARD UNDER ORIGINAL IFB
DECISION THAT AN AWARD SHOULD BE MADE TO THE JULIAN SPEER COMPANY,
PROTESTANT FOR ALTERATIONS AND CONSTRUCTION OF A 99-BED NURSING HOME
CARE UNIT UNDER AN IFB ISSUED BY THE CHILLICOTHE VA HOSPITAL.
ALTHOUGH THE ORIGINAL IFB WAS CANCELLED AFTER BID OPENING PURSUANT TO
THE PRESIDENTIAL PROCLAMATION SUSPENDING THE DAVIS-BACON ACT, SUBSEQUENT
TO THE REINSTATEMENT OF THE ACT, THE DEPARTMENT OF LABOR ISSUED
MEMORANDUM #93 PROVIDING THAT WHERE "NO FURTHER ACTION HAS BEEN TAKEN
AND NO CONTRACT ENTERED INTO PURSUANT TO SUCH SOLICATION BETWEEN
FEBRUARY 23, AND MARCH 29," A CONTRACT SUBJECT TO THE PROVISIONS OF THE
ACT MAY BE ENTERED INTO AS IT WOULD HAVE BEEN IF THERE HAD BEEN NO
SUSPENSION.
THEREFORE, IN ORDER TO PROTECT THE COMPETITIVE BIDDING SYSTEM AND
AVOID PREJUDICE TO PROTESTANT JULIAN SPEER COMPANY, LOW BIDDER, UNDER
THE ORIGINAL IFB MAY BE AWARDED THE CONTRACT AS ORIGINALLY SOLICITED.
TO MR. JOHNSON:
REFERENCE IS MADE TO LETTER DATED APRIL 27, 1971, REFERENCE 134G FROM
THE DIRECTOR, SUPPLY SERVICE, DEPARTMENT OF MEDICINE AND SURGERY,
REQUESTING OUR DECISION IN THE MATTER OF THE BID PROTEST MADE BY JULIAN
SPEER COMPANY TO THE CHIEF, SUPPLY DIVISION, VA HOSPITAL, CHILLICOTHE,
OHIO, UNDER PROJECT NO. 34-5297, SPEC. NO. 538-50S.
AN INVITATION FOR BIDS WAS ORIGINALLY ISSUED ON JANUARY 19, 1971, BY
THE CHILLICOTHE HOSPITAL FOR THE ALTERATION OF EXISTING SPACE IN
BUILDING NO. 212, FIRST AND SECOND FLOORS, TO PROVIDE A 99-BED NURSING
HOME CARE UNIT. BIDS WERE OPENED ON FEBRUARY 18, 1971, WITH THE
FOLLOWING BIDS RECEIVED:
BIDDER
JULIAN SPEER COMPANY $294,844.00
B. R. LEPPER CONSTRUCTION CO. $296,277.00
GROHNE COMPANY INC. *$296,330.00
*AS MODIFIED BY TELEGRAM OF FEBRUARY 18, 1971. THE SOLICITATION WAS
CANCELLED MARCH 8, 1971, DUE TO PRESIDENTIAL PROCLAMATION 4031 OF
FEBRUARY 23, 1971, SUSPENDING THE DAVIS-BACON ACT, 40 U.S.C. 276A.
THE HOSPITAL'S REQUIREMENTS WERE READVERTISED WITH THE INTENTION OF
EXCLUDING THE PROVISIONS OF THE DAVIS-BACON ACT. THE DIRECTOR ADVISES
THAT THE INVITATION FOR BIDS (STANDARD FORM 20), INCLUDING INFORMATION
REGARDING BIDDING MATERIAL, BID GUARANTEE, BONDS, ETC., WAS RELEASED TO
PROSPECTIVE BIDDERS ON MARCH 18, 1971. HOWEVER, SUCH DOCUMENTS DID NOT
INCLUDE THE BID FORM (STANDARD FORM 21) OR THE SPECIFICATIONS AND
DRAWINGS, THE ISSUE DATE OF THE TWO LATTER DOCUMENTS BEING SHOWN AS
APRIL 1, 1971. THE PROVISIONS OF THE DAVIS-BACON ACT WERE NOT INCLUDED
IN THE DOCUMENTS RELEASED ON MARCH 18.
THE DIRECTOR ALSO ADVISES THAT THE BID FORM (STANDARD FORM 21), ALONG
WITH SPECIFICATIONS AND DRAWINGS, WERE ISSUED APRIL 1, 1971, WITHOUT THE
PROVISIONS OF THE DAVIS-BACON ACT AND WITH A BID OPENING DATE OF APRIL
15, TO PROSPECTIVE CONTRACTORS WHO HAD EXPRESSED AN INTEREST IN BIDDING.
ON APRIL 14, 1971, THE CONTRACTING OFFICER ISSUED AMENDMENT NO. 1 TO
THE SOLICITATION, INCORPORATING THE DAVIS-BACON ACT CLAUSES AND
EXTENDING THE BID OPENING DATE FROM APRIL 15 TO APRIL 19, 1971. THE
AMENDMENT IS SAID TO HAVE BEEN ISSUED BASED ON THE CONTRACTING OFFICER'S
CONSIDERATION OF APRIL 1 AS THE DATE OF THE RESOLICITATION. IT IS THE
FURTHER VIEW OF THE DIRECTOR THAT THE DOCUMENTS RELEASED ON MARCH 18
MERELY SERVED AS A PRE-INVITATION NOTICE, SINCE THEY DID NOT CONTAIN THE
ESSENTIAL REQUIREMENTS FOR A BIDDER TO SUBMIT A BID.
THREE BIDS HAVE BEEN RECEIVED IN RESPONSE TO THE RESOLICITATION FROM
THE SAME THREE BIDDERS WHO BID ON THE ORIGINAL SOLICITATION. THE BIDS
HAVE NOT BEEN OPENED, PENDING RESOLUTION OF THE PROTEST.
THE JULIAN SPEER COMPANY PROTESTS CANCELLATION OF THE ORIGINAL
INVITATION AND STATES THAT THE SPECIAL CIRCUMSTANCES REGARDING THE
TIMING OF THIS PROCUREMENT WITH RESPECT TO THE DAVIS-BACON PROCLAMATIONS
OF FEBRUARY 23 AND MARCH 29, 1971, REQUIRE SPECIAL CONSIDERATION IN
ORDER TO BE EQUITABLE AND TO MAINTAIN THE INTEGRITY OF THE COMPETITIVE
BIDDING SYSTEM. THE COMPANY THEREFORE HAS EXTENDED THE TIME FOR
ACCEPTANCE OF ITS LOW BID UNDER THE ORIGINAL SOLICITATION, AND ASKS THAT
IT BE AWARDED A CONTRACT BASED ON THAT BID.
AUTHORITY FOR THE PROCUREMENT AGENCY'S ACTION IN CANCELLING THE
ORIGINAL SOLICITATION AND READVERTISING THE PROCUREMENT WITHOUT THE
PROVISIONS OF THE DAVIS-BACON ACT STEMS FROM THE ACT ITSELF, SECTION 6
OF WHICH PROVIDES:
"IN THE EVENT OF A NATIONAL EMERGENCY THE PRESIDENT IS AUTHORIZED TO
SUSPEND THE PROVISIONS OF THIS ACT." SUSPENSION ACTION WAS TAKEN
THEREUNDER BY PRESIDENTIAL PROCLAMATION 4031 DATED FEBRUARY 23, 1971.
ON FEBRUARY 26, 1971, THE ACTING ADMINISTRATOR, GSA, ISSUED A
DIRECTIVE TO THOSE CIVIL AGENCIES OF THE GOVERNMENT SUBJECT TO THE
FEDERAL PROCUREMENT REGULATIONS (FPR) IN IMPLEMENTATION OF THE
PROCLAMATION WHICH SUSPENDED THE DAVIS-BACON ACT REQUIREMENTS AS
CONTAINED IN THE FPR AND SET OUT PROCEDURES TO BE FOLLOWED WITH RESPECT
TO INVITATIONS WHICH HAD SOLICITED BIDS BASED UPON COMPLIANCE WITH THE
ACT. INSOFAR AS PERTINENT TO THE INSTANT MATTER THE PROCEDURE DIRECTED
AGENCIES TO CANCEL INVITATION FOR BIDS IF BIDS HAD BEEN OPENED PRIOR TO
FEBRUARY 23, 1971, BUT AWARDS HAD NOT BEEN MADE, AND TO RESOLICIT BIDS
AFTER DELETION OF ALL DAVIS-BACON ACT REQUIREMENTS.
THE CANCELLATION OF THE INVITATION FOR PROJECT NO. 34-5297, SPEC. NO
538-50S, FOLLOWED THIS DIRECTIVE ON MARCH 8, 1971.
THEREAFTER, THE PRESIDENT ISSUED PROCLAMATION 4040 DATED MARCH 29,
1971, WHICH REVOKED PROCLAMATION 4031 AND EFFECTIVELY REINSTATED THE
DAVIS-BACON ACT AS TO CONSTRUCTION CONTRACTS FOR WHICH SOLICITATIONS FOR
BIDS OR BIDS OR PROPOSALS WERE ISSUED AFTER MARCH 29, 1971. IN VIEW
THEREOF, THE INITIAL QUESTION TO BE DECIDED IS WHETHER AN INVITATION WAS
ISSUED BETWEEN FEBRUARY 23 AND MARCH 29 UNDER WHICH A CONTRACT WITHOUT
THE DAVIS-BACON ACT PROVISIONS COULD PROPERLY BE AWARDED.
WHILE THE DIRECTOR'S LETTER OF APRIL 27 ADVISES THAT THE DOCUMENTS
RELEASED TO BIDDERS ON MARCH 18 WERE INTENDED TO EXCLUDE THE PROVISIONS
OF THE DAVIS-BACON ACT, WE MUST AGREE WITH HIS CONCLUSION THAT SUCH
DOCUMENTS MUST BE REGARDED ONLY AS A PRE-INVITATION NOTICE, SINCE THEY
DID NOT INCLUDE THE ESSENTIAL REQUIREMENTS FOR A BIDDER TO SUBMIT A BID.
IT FOLLOWS, THEREFORE, THAT THE DATE ON WHICH BIDS WERE RESOLICITED MUST
BE REGARDED AS APRIL 1.
FOLLOWING ISSUANCE OF PRESIDENTIAL PROCLAMATION 4040 ON MARCH 29, THE
DEPARTMENT OF LABOR (WHICH HAS STATUTORY AUTHORITY AND RESPONSIBILITY TO
ISSUE REGULATIONS DIRECTED TO UNIFORM ADMINISTRATION AND APPLICATION OF
THE DAVIS-BACON ACT) ISSUED MEMORANDUM #93 DATED APRIL 6, WHICH READS IN
PERTINENT PART AS FOLLOWS:
"WHERE BIDS OR PROPOSALS FOR CONTRACT WORK WERE SOLICITED SUBJECT TO
DAVIS-BACON PROVISIONS PRIOR TO PROCLAMATION 4031 SUSPENDING SUCH
PROVISIONS WITH RESPECT TO 'CONTRACTS ENTERED INTO' ON OR AFTER FEBRUARY
23, 1971, AND NO FURTHER ACTION HAS BEEN TAKEN AND NO CONTRACT ENTERED
INTO PURSUANT TO SUCH SOLICITATION BETWEEN FEBRUARY 23 AND MARCH 29,
1971, INCLUSIVE, IT WOULD APPEAR THAT NO CONTRACT OR SOLICITATION
THEREFORE BECAME SUBJECT TO THE SUSPENSION PROCLAMATION BEFORE THE
REVOCATION BY PROCLAMATION 4040 AND THAT THE ADDITIONAL EFFORT AND
EXPENSE OF ISSUING A RESOLICITATION AFTER MARCH 29, 1971, WOULD NOT BE
REQUIRED AS A RESULT SOLELY OF THE TWO PROCLAMATIONS. SO LONG AS THE
WAGE DETERMINATION ON THE BASIS OF WHICH THE SOLICITATION WAS MADE
REMAINS IN EFFECT, A CONTRACT SUBJECT TO ITS PROVISIONS MAY BE ENTERED
INTO AS IT WOULD HAVE BEEN IF THERE HAD BEEN NO SUSPENSION DURING THE
INTERVENING PERIOD."
SINCE NO EFFECTIVE RESOLICITATION HAD BEEN ACCOMPLISHED IN THE
INSTANT PROCUREMENT PRIOR TO MARCH 30, IT IS OUR OPINION THAT THE
PROCUREMENT MUST BE CONSIDERED AS ONE ON WHICH "NO FURTHER ACTION HAS
BEEN TAKEN AND NO CONTRACT ENTERED INTO PURSUANT TO SUCH SOLICITATION
BETWEEN FEBRUARY 23 AND MARCH 29," AS SET OUT IN THAT PORTION OF
MEMORANDUM NO. 93 WHICH IS QUOTED ABOVE.
IN THIS CONNECTION, WE ARE ALSO PERSUADED BY THE FACT THAT BOTH THE
SPECIFICATIONS AND THE MINIMUM WAGE RATES INCLUDED IN THE RESOLICITATION
ARE IDENTICAL WITH THOSE INCLUDED IN THE ORIGINAL SOLICITATION. UNDER
THE CIRCUMSTANCES, WE SEE NO COMPELLING REASON FOR RESOLICITING BIDS,
AFTER THE ORIGINAL BID PRICES HAVE BEEN REVEALED, ON THE IDENTICAL TERMS
ON WHICH THE ORIGINAL BIDS WERE SOLICITED AND THE ORIGINAL BID PRICES
WERE COMPUTED. CONVERSELY, IT IS OUR OPINION THAT SUCH A PROCEDURE
WOULD BE PREJUDICIAL TO THE LOW RESPONSIVE AND RESPONSIBLE BIDDER ON THE
ORIGINAL SOLICITATION, AND WOULD ADVERSELY REFLECT UPON THE INTEGRITY OF
THE COMPETITIVE BIDDING SYSTEM.
ACCORDINGLY, WE CONCUR IN THE DIRECTOR'S RECOMMENDATION THAT THE
AWARD, IF OTHERWISE PROPER, SHOULD BE MADE TO JULIAN SPEER COMPANY UNDER
THE ORIGINAL SOLICITATION.
THE FILE FORWARDED WITH THE DIRECTOR'S LETTER OF APRIL 27 IS
RETURNED.
B-172645, MAY 12, 1971
CONTRACTS - MISTAKE IN BID - RESCISSION
DECISION ALLOWING RESCISSION OF A CONTRACT BETWEEN UPLAND INDUSTRIES,
INC., AND THE PROCUREMENT OPERATIONS DIVISION, FEDERAL SUPPLY SERVICE
FOR A QUANTITY OF FLAT-TYPE SCREWDRIVERS 1 3/4 INCHES LONG WITH A 5/16
INCH DIAMETER BLADE.
IT APPEARS THAT A TYPOGRAPHICAL MISTAKE IN BID WAS MADE, UPLAND BEING
UNABLE TO MANUFACTURE THE SUBJECT ITEM. FURTHER, THE BID OF $0.17 PER
UNIT PRICE, WHICH PLACED THE CONTRACTING OFFICER ON CONSTRUCTIVE NOTICE
OF A POSSIBLE ERROR. THEREFORE, THE CONTRACT MAY BE RESCINDED WITHOUT
LIABILITY TO THE CONTRACTOR.
TO MR. KUNZIG:
WE REFER TO THE LETTER OF YOUR GENERAL COUNSEL, DATED APRIL 19, 1971,
WITH ENCLOSURES, CONCERNING THE REQUEST FOR RESCISSION OF REQUIREMENTS
CONTRACT GS-OOS-88031 FOR FLATTIP SCREWDRIVERS AWARDED TO UPLAND
INDUSTRIES, INC., BY THE PROCUREMENT OPERATIONS DIVISION, FEDERAL SUPPLY
SERVICE, UNDER SOLICITATION FPNTN-G2-70885-A-5-7-70, ISSUED APRIL 6,
1970.
UPLAND WAS AWARDED THIS CONTRACT COVERING ITEM 21 ON AUGUST 21, 1970,
AS LOW BIDDER AT A UNIT PRICE OF $0.17. SUBSEQUENT TO THE AWARD, UPLAND
CLAIMED IN ITS LETTER OF SEPTEMBER 3, 1970, THAT IT HAD MADE A MISTAKE
IN ITS BID FOR ITEM 21 AS IT DID NOT MANUFACTURE THIS PARTICULAR
SCREWDRIVER, WHICH CALLS FOR A 5/16-INCH DIAMETER BLADE WITH A LENGTH OF
1 3/4 INCHES. IN RESPONSE TO THE CONTRACTING OFFICER'S REQUEST FOR
FURTHER EVIDENCE ON THE ALLEGED ERROR, UPLAND ASSERTED IN ITS LETTER OF
SEPTEMBER 11, 1970, THAT ITS MISTAKE WAS DUE TO A TYPOGRAPHICAL ERROR IN
THE PLACEMENT OF ITS BID FIGURES AND THAT IT HAD INTENDED TO BID ON
ITEMS 19 AND 20, RATHER THAN ON ITEMS 20 AND 21.
UPON THE CONTRACTING OFFICER'S REQUEST FOR PROOF THAT UPLAND DID
MANUFACTURE ITEMS 19 AND 20 AND DID NOT MANUFACTURE ITEM 21, UPLAND
SUBMITTED ITS CATALOG NO. 18 WITH COVERING LETTER OF DECEMBER 8, 1970,
AS EVIDENCE THAT IT MANUFACTURED ITEMS 19 AND 20. HOWEVER, THE
PARTICULAR TYPE OF SCREWDRIVER DESCRIBED IN ITS LETTER AND
CROSS-REFERENCED IN ITS CATALOG DID NOT MEET THE SPECIFICATION
REQUIREMENTS FOR ITEM 19. FURTHERMORE, THE CONTRACTOR DID NOT OFFER ANY
EVIDENCE REGARDING THE MANUFACTURE OF ITEM 20. IN RESPONSE TO A REQUEST
FOR FURTHER CLARIFICATION ON THE MATTER, UPLAND RESPONDED BY LETTER OF
DECEMBER 29, 1970, THAT IT COULD MANUFACTURE THE SCREWDRIVER COVERED BY
ITEM 20, WHICH HAS A BLADE LENGTH OF 1 1/2 INCHES, BY DRIVING THE BLADE
FURTHER INTO THE HANDLE. AS TO ITEM 21, UPLAND ASSERTED IN ITS LETTER
OF JANUARY 6, 1971, SUPPLEMENTING ITS DECEMBER 29 LETTER, THAT THIS ITEM
REQUIRES A BLADE WITH A 5/16 DIAMETER, WHICH UPLAND DOES NOT MAKE SHORT
ENOUGH TO MEET THE REQUIREMENT FOR THIS SCREWDRIVER.
INSOFAR AS THE PROOF ADDUCED BY UPLAND DID NOT APPEAR CONCLUSIVE AS
TO ITS CLAIM OF MISTAKE, UPLAND WAS AGAIN REQUESTED TO CLARIFY ITS
SUBMISSION IN REGARD TO ITEMS 19 AND 20. IN RESPONSE TO THIS REQUEST,
UPLAND, IN ITS LETTER OF MARCH 15, 1971, FORWARDED A WORKSHEET
CONTAINING A NOTATION, APPARENTLY, TO THE EFFECT THAT ITEM 21 IS NOT IN
ITS LINE OF MANUFACTURE. AS TO ITEMS 19 AND 20, UPLAND SUBMITTED TWO
CATALOGS, NO. 17 OF OCTOBER 1969 AND NO. 18 OF OCTOBER 1970. SINCE
CATALOG NO. 18 WAS ISSUED AFTER AWARD OF THIS CONTRACT, CATALOG NO. 17
IS MORE RELEVANT AS EVIDENCE TO SUPPORT UPLAND'S CLAIM THAT IT CARRIED
THE ITEM 19 SCREWDRIVER AS A REGULAR STOCK ITEM. THIS TYPE OF
SCREWDRIVER IS REFERENCED BY UPLAND ON PAGE 16 OF CATALOG NO. 17 AND ON
PAGE 21 OF CATALOG NO. 18.
YOUR GENERAL COUNSEL STATES THAT WHILE THE FOREGOING EVIDENCE DOES
NOT APPEAR TO BE OF THE HIGHEST PROBATIVE VALUE, IT DOES APPEAR THAT
UPLAND DOES MANUFACTURE ITEM 19 AND HAS THE CAPABILITY TO MANUFACTURE
ITEM 20. FURTHER, IT APPEARS THAT ITEM 21 IS NOT AN UPLAND CATALOG ITEM.
YOUR GENERAL COUNSEL IS, THEREFORE, OF THE OPINION THAT THERE IS
SUFFICIENT EVIDENCE TO SUPPORT THE CONTRACTING OFFICER'S DETERMINATION
THAT A MISTAKE WAS MADE. HE ALSO CONCURS WITH THE CONTRACTING OFFICER'S
DETERMINATION THAT BECAUSE OF THE VARIANCE OF 26 PERCENT BETWEEN
UPLAND'S BID AND THE NEXT LOW BID, THE CONTRACTING OFFICER WAS ON
CONSTRUCTIVE NOTICE OF POSSIBLE MISTAKE AND SHOULD NOT HAVE ACCEPTED THE
BID WITHOUT VERIFICATION. THE PRICE OF $0.17 PER UNIT QUOTED BY UPLAND
WAS SUBSTANTIALLY LOWER THAN THE PRICES OF $0.23, $0.23, AND $0.35,
WHICH WERE SUBMITTED BY THE OTHER THREE BIDDERS ON ITEM 21. ALSO, A
COMPARISON OF UPLAND'S BID PRICE WITH THE PRIOR YEAR'S CONTRACT PRICE OF
$0.23 WOULD HAVE INDICATED THIS SUBSTANTIAL VARIANCE. BOTH YOUR GENERAL
COUNSEL AND THE CONTRACTING OFFICER RECOMMEND THAT RESCISSION OF THE
CONTRACT WITH UPLAND BE ALLOWED.
AFTER REVIEWING THE RECORD, WE BELIEVE THAT A MISTAKE DID OCCUR AND
THAT THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF POSSIBLE
ERROR IN THE BID BECAUSE OF THE 26-PERCENT VARIANCE BETWEEN UPLAND'S BID
AND THE NEXT LOW BID. CONSEQUENTLY, HE SHOULD HAVE REQUESTED
VERIFICATION BEFORE MAKING AWARD ON THE BID. B-165934, FEBRUARY 3,
1969.
SINCE ACCEPTANCE OF A BID WITH KNOWLEDGE, EITHER CONSTRUCTIVE OR
ACTUAL, OF ERROR THEREIN DOES NOT CONSUMMATE A VALID AND BINDING
CONTRACT, THE CONTRACT FOR ITEM 21 MAY BE RESCINDED, AS ADMINISTRATIVELY
RECOMMENDED, WITHOUT LIABILITY TO THE CONTRACTOR.
WE ARE RETURNING THE ENCLOSURES SENT WITH THE LETTER OF APRIL 19 AS
REQUESTED.
B-170461, MAY 11, 1971
BID PROTEST - COMPETITION
DECISION DENYING PROTEST AGAINST THE PROCUREMENT PROCEDURES INVOLVED
IN AN RFP ISSUED BY THE ARMAMENT DEVELOPMENT AND TEST CENTER, EGLIN AFB,
FLORIDA, FOR TECHNICAL PROPOSALS FOR DESIGN DEVELOPMENT, FABRICATION AND
QUALIFICATION TESTING OF AN ALL-ALTITUDE SPIN PROJECTED MUNITION.
AN RFP FOR RESEARCH AND DEVELOPMENT IS SUCH THAT FORMAL ADVERTISING
WITH THE DETAILED AND PRECISE SPECIFICATIONS AS REQUIRED BY 10 U.S.C.
2305(B) IS NEITHER FEASABLE NOR PRACTICABLE. FURTHER, BECAUSE POTENTIAL
OFFERORS WERE AFFORDED THE OPPORTUNITY AT THE PREPROPOSAL CONFERENCE TO
RAISE QUESTIONS CONCERNING THE REQUIREMENTS, FULL AND FREE COMPETITION
WAS PROVIDED.
TO FINKELSTEIN AND MUETH
FURTHER REFERENCE IS MADE TO YOUR PROTEST ON BEHALF OF SPECIAL
DEVICES, INCORPORATED, AGAINST THE PROCUREMENT PROCEDURES INVOLVED IN
REQUEST FOR PROPOSALS NO. F08635-70-R-0113, ISSUED BY THE ARMAMENT
DEVELOPMENT AND TEST CENTER, EGLIN AIR FORCE BASE, FLORIDA.
THE SOLICITATION REQUESTED TECHNICAL PROPOSALS TO BE SUBMITTED ON
PERFORMING CERTAIN WORK, THE GENERAL SCOPE OF WHICH IS SET FORTH IN THE
SCHEDULE AS FOLLOWS:
"ALL-ALTITUDE SPIN PROJECTED MUNITION (ASP)
"1.0 INTRODUCTION. PRESENT LINEAR MUNITION DISPENSERS SUCH AS THE
SUU-13/A AND SUU-37/A DELIVER SUBMUNITIONS IN LONG, NARROW GROUND
PATTERNS WHEN DISPERSED FROM LOW ALTITUDES. HIGHER RELEASE ALTITUDES
COUPLED WITH SELF-DISPERSING SUBMUNITIONS WILL PROVIDE WIDER PATTERNS
BUT PATTERN SIZE AND/OR SUBMUNITION DENSITY, FOR OPTIMUM EFFECTIVENESS,
CAN ONLY BE ACHIEVED WITHIN A LIMITED RANGE OF RELEASE CONDITIONS. THIS
RESTRICTION IS UNDESIRABLE FROM A TACTICAL STANDPOINT. NON-LINEAR
DISPENSERS, SUCH AS THE SUU-30/B, DELIVER SELF-DISPERSING SUBMUNITIONS
IN A WIDE PATTERN BUT ARE PLAGUED WITH THE UNAVOIDABLE HOLE IN THE
MIDDLE OF THE PATTERN. THE ALL-ALTITUDE SPIN PROJECTED MUNITION (ASP)
WILL DISPENSE A VARIETY OF SUBMUNITIONS AND ACHIEVE OPTIMUM GROUND
PATTERNS INDEPENDENT OF RELEASE CONDITIONS.
"2.0 SCOPE. THIS WILL BE AN ENGINEERING DEVELOPMENT PROGRAM FOR THE
DESIGN, DEVELOPMENT, FABRICATION, AND QUALIFICATION TESTING
(ENVIRONMENTAL AND COMPONENT FUNCTIONAL TESTS) OF THE ALL-ALTITUDE SPIN
PROJECTED MUNITION (ASP). AN AERODYNAMIC ANALYSIS WILL BE ACCOMPLISHED
TO DETERMINE THE BEST SHAPE OF THE DISPENSER. THE PROGRAM WILL INCLUDE
DEVELOPMENT OF A CONTAINER TO ACCOMMODATE ONE OR MORE ASP AND THE EFFORT
WILL CONCLUDE WITH AF FLIGHT EVALUATION TESTS OF COMPLETE MUNITIONS."
THE SOLICITATION ADVISED THAT A PREPROPOSAL CONFERENCE WOULD BE HELD
AT EGLIN AIR FORCE BASE AND REQUESTED POTENTIAL CONTRACTORS TO SUBMIT IN
WRITING ANY QUESTION THEY MIGHT HAVE CONCERNING THE REQUIREMENTS. THE
SOLICITATION ALSO ADVISED THAT THE GOVERNMENT CONTEMPLATED ENTERING INTO
A COST-PLUS-INCENTIVE-FEE TYPE CONTRACT FOR THE PERFORMANCE OF THE WORK
BUT ALLOWED OFFERORS TO SPECIFY THEIR PREFERENCE AS TO CONTRACT TYPE.
PROPOSALS WERE RECEIVED FROM FIVE FIRMS. THE PROPOSALS WERE
EVALUATED AND AS A RESULT IT WAS DETERMINED THAT NEGOTIATIONS SHOULD BE
CONDUCTED WITH THREE OF THE PROPOSERS FOUND TO BE WITHIN THE COMPETITIVE
RANGE. THE PROPOSALS OF SPECIAL DEVICES AND ANOTHER FIRM WERE
DETERMINED TO BE TECHNICALLY INADEQUATE AND OUTSIDE THE COMPETITIVE
RANGE.
BY LETTER DATED JULY 18, 1970, YOU CONTENDED THAT THE REQUEST FOR
PROPOSALS WAS INVALID AND THAT AN AWARD THEREUNDER WOULD BE ILLEGAL. YOU
ASSERT THAT THE REQUEST FOR PROPOSALS IS IN COMPLETE VIOLATION OF TITLE
10, UNITED STATES CODE, SECTION 2305(B), SINCE IT FAILS TO INCLUDE
SUFFICIENT DESCRIPTIVE LANGUAGE AND ATTACHMENTS TO PERMIT FULL AND FREE
COMPETITION ON A COMMON BASIS.
THE PROVISIONS OF TITLE 10, UNITED STATES CODE, SECTIONS 2305 (A)
THROUGH (D), AS PROVIDED IN SUBSECTION (A), ARE APPLICABLE WHENEVER
FORMAL ADVERTISING IS REQUIRED UNDER SECTION 2304. SINCE THE INSTANT
PROCUREMENT IS NEGOTIATED THE REQUIREMENTS OF SECTION 2305 ARE NOT
APPLICABLE.
THE STATEMENT OF WORK SET FORTH IN THE SOLICITATION INDICATES A NEED
FOR STUDY, DEVELOPMENT, DESIGN, FABRICATION AND TESTING, IN ORDER THAT
THE GOVERNMENT MIGHT OBTAIN INFORMATION UNKNOWN TO IT. THEREFORE, IT
WAS NOT POSSIBLE FOR THE GOVERNMENT TO FORMULATE PRECISE AND DETAILED
SPECIFICATIONS NECESSARY FOR FORMAL ADVERTISING. THE SOLICITATION WAS
PREPARED IN ACCORDANCE WITH PART 1, SECTION 4, OF THE ARMED SERVICES
PROCUREMENT REGULATION (ASPR), WHICH APPLIES THE PRINCIPLES PRESCRIBED
BY ASPR 3-805.2 WHERE A COST-REIMBURSEMENT TYPE CONTRACT IS PROPOSED.
WHILE A PROCUREMENT MAY BE PROPER FOR NEGOTIATIONS, THE STATEMENT OF
WORK SHOULD AS FAR AS POSSIBLE PROVIDE INFORMATION FOR ALL QUALIFIED
POTENTIAL OFFERORS TO UNDERSTAND THE GOVERNMENT'S NEEDS. IN THIS
CONNECTION ASPR 4-105(A) PROVIDES:
"THE PREPARATION AND USE OF A CLEAR AND COMPLETE STATEMENT OF WORK IS
ESSENTIAL TO SOUND CONTRACTING FOR RESEARCH AND DEVELOPMENT. IN
RESEARCH, EXPLORATORY DEVELOPMENT AND ADVANCED DEVELOPMENT, STATEMENTS
OF WORK MUST BE INDIVIDUALLY TAILORED BY TECHNICAL AND CONTRACTING
PERSONNEL TO ATTAIN THE DESIRED DEGREE OF FLEXIBILITY FOR CONTRACTOR
CREATIVITY, BOTH IN SUBMITTING PROPOSALS AND IN CONTRACT PERFORMANCE.
CAREFUL DISTINCTION MUST BE DRAWN BETWEEN LEVEL-OF-EFFORT WORK
STATEMENTS, WHICH ESSENTIALLY REQUIRE THE FURNISHING OF TECHNICAL EFFORT
AND A REPORT ON THE RESULTS THEREOF, AND TASK COMPLETION TYPE WORK
STATEMENTS WHICH OFTEN REQUIRE DEVELOPMENT OF TANGIBLE END ITEMS
DESIGNED TO MEET SPECIFIC PERFORMANCE CHARACTERISTICS."
IT IS REPORTED THAT THE STATEMENT OF WORK AND INFORMATION FURNISHED
IN THE REQUEST FOR PROPOSALS ARE CONSIDERED ADEQUATE FOR OFFERORS TO
UNDERSTAND THE GOVERNMENT'S NEEDS AND TO PREPARE TECHNICAL PROPOSALS
SHOWING HOW THEY PROPOSE TO MEET SUCH NEEDS. IT IS FURTHER REPORTED
THAT THE INFORMATION WHICH YOU ALLEGE SHOULD HAVE BEEN IN THE REQUEST
FOR PROPOSALS EITHER IS NOT REQUIRED FOR THE SUBMISSION OF PROPOSALS OR
IS A PART OF THE WORK TO BE PERFORMED UNDER THE CONTRACT TO BE AWARDED.
IN THIS REGARD IT IS STATED THAT ANNEX I PROVIDES INSTRUCTIONS FOR
CONDUCTING THE STUDY PORTION OF THE ASP DEVELOPMENT PROGRAM. SINCE THIS
STUDY WAS TO BE PERFORMED UNDER ITEM 1 OF THE CONTRACT TO BE AWARDED, A
COMPLETE STUDY WAS NOT REQUIRED TO BE IN THE PROPOSAL. LIKEWISE ANNEX
II DID NOT REQUIRE A COMPLETE COMPATIBILITY ANALYSIS TO BE CONTAINED IN
THE PROPOSAL. RATHER, THE PROPOSALS WERE TO DEMONSTRATE THE OFFERORS'
METHODOLOGY AND CAPABILITY TO PERFORM THE STUDY AND ANALYSIS. ANY
QUESTIONS CONCERNING THE REQUIREMENTS SHOULD HAVE BEEN RAISED AT THE
PREPROPOSAL CONFERENCE WHICH WAS HELD FOR THIS PURPOSE.
YOU CONTEND THAT THERE IS CONTRADICTORY INFORMATION IN ANNEX I AND
ANNEX II CONCERNING THE TYPE OF FUZING. THE ADMINISTRATIVE REPORT
DENIES ANY CONFUSION REGARDING THE ASP FUZING REQUIREMENTS. ANNEX I
(STUDY), PARAGRAPH 3.4 REQUIRES A FUNCTIONAL DEFINITION OF THE ASP
FUZING SYSTEM AND AN ASSESSMENT OF THE FMU-56 A/B PROXIMITY FUZE TO MEET
THE DEFINED REQUIREMENTS. ANNEX II (DESIGN), PARAGRAPH 3.4.5 PROVIDES:
"THE ASP SHALL USE A PROXIMITY FUZE DESIGNATED BY THE U.S. AIR FORCE.
THE CONTRACTOR SHALL BE RESPONSIBLE FOR ASSURING COMPATIBILITY BETWEEN
DISPENSER ELECTRO/MECHANICAL SYSTEMS AND THE DESIGNATED PROXIMITY FUZE."
UNDER SUCH PROVISIONS THE PRECISE DISPENSER ELECTRO/MECHANICAL SUBSYSTEM
FUNCTIONS ARE FOR THE CONTRACTOR TO DETERMINE, INCLUDING WHETHER AN
ELECTRONIC TIMER IS NEEDED IN ADDITION TO A PROXIMITY FUZE.
YOU ALLEGE THAT THE REQUIREMENTS FAILED TO IDENTIFY A SPECIFIC
"CRATERING BOMB" NOW KNOWN BY SPECIAL DEVICES TO HAVE BEEN THE DESIRED
SUBMUNITION FOR INCLUSION UNDER ANNEX I, PARAGRAPH 3.0 AND IN PARTICULAR
3.1D. IT IS REPORTED THAT THE REFERENCE TO "CRATERING BOMB" IS ASSUMED
TO BE AN "ADVANCED CRATERING BOMB" PRESENTLY IN A DEFINITION PHASE OF
DEVELOPMENT BY ONE OF THE PROPOSERS UNDER THIS REQUEST FOR PROPOSALS AND
AS TO WHICH SPECIAL DEVICES RAISED A QUESTION AT THE PREPROPOSAL
CONFERENCE AS FOLLOWS:
"ASSUMING THAT THE NEW CRATERING BOMB IS THE PRIMARY CANDIDATE FOR
RUNWAY TARGETS, COULD YOU DESCRIBE ITS OPERATION AND PHYSICAL
CHARACTERISTICS SO ITS USE IN ASP COULD BE EVALUATED, OR IS THIS
DETAILED ANALYSIS CONSIDERED NOT NECESSARY FOR THE PROPOSAL." THE
RESPONSE WAS:
"THE DATA IS NOT CONSIDERED NECESSARY FOR PROPOSAL PURPOSES, HOWEVER,
IT WOULD BE MADE AVAILABLE TO SUCCESSFUL BIDDER AFTER CONTRACT AWARD.
FOR PROPOSAL PURPOSES THOUGH IT IS DESIRABLE TO HAVE A SINGLE
UNINTERRUPTED PAYLOAD VOLUME."
IT IS FURTHER REPORTED THAT THE ADVANCED CRATERING BOMB IS NOT YET AN
EXISTING SUBMUNITION, NOR HAS IT BEEN DEFINED FUNCTIONALLY OR
DIMENSIONALLY; THAT SEVERAL OTHER DESIGNS ARE STILL UNDER STUDY FROM
OTHER SOURCES AND A DESIGN CHOICE IS YET TO BE MADE; THAT WHEN A
DECISION IS MADE THE DESIGN DATA WILL BE PROVIDED TO THE SUCCESSFUL
BIDDER AFTER CONTRACT AWARD; AND THAT DATA ON SUCH SUBMUNITIONS WAS NOT
ESSENTIAL TO THE SUBMISSION OF PROPOSALS, AS ANNOUNCED AT THE
PREPROPOSAL CONFERENCE, AND THE INCLUSION OF SUCH DATA IN THE PROPOSALS
WAS NOT USED AS AN EVALUATION FACTOR. THE ASP DISPENSER SHOULD BE ABLE
TO DISPENSE ALL SUBMUNITIONS POSSIBLE AND THIS IS TO BE DETERMINED UNDER
THE STUDY IN ITEM 1 OF THE CONTRACT.
IT SEEMS CLEAR FROM THE RECORD THAT THE TECHNICAL NATURE (RESEARCH
AND DEVELOPMENT) OF THIS PROCUREMENT IS SUCH THAT FORMAL ADVERTISING
WITH THE DETAILED AND PRECISE SPECIFICATIONS AS REQUIRED BY 10 U.S.C.
2305(B) WAS NEITHER FEASIBLE OR PRACTICABLE. WHILE WE DO NOT KNOW THE
EXTENT WHICH ADDITIONAL INFORMATION WOULD HAVE ASSISTED IN THE
PREPARATION OF TECHNICAL PROPOSALS, IT IS NOTED THAT SEVERAL OF THE
PROPOSALS RECEIVED WERE CONSIDERED TO BE TECHNICALLY ACCEPTABLE AND
WITHIN THE COMPETITIVE RANGE. ALSO, POTENTIAL OFFERORS WERE AFFORDED
THE OPPORTUNITY AT THE PREPROPOSAL CONFERENCE TO RAISE ANY QUESTIONS
THEY MAY HAVE HAD CONCERNING THE REQUIREMENTS.
FOR THE FOREGOING REASONS, WE FIND NO BASIS TO QUESTION THE ADEQUACY
OF THE REQUIREMENTS SET FORTH IN THE REQUEST FOR PROPOSALS OR THE
PROCEDURES FOLLOWED IN THE INSTANT PROCUREMENT.
ACCORDINGLY, YOUR PROTEST MUST BE DENIED.
B-171177(2), MAY 11, 1971
BID PROTEST - MULTIPLE AWARDS - LOWEST INDIVIDUAL OFFEROR
WITH RESPECT TO THE PROTEST OF CHAMBERLAIN MANUFACTURING CORP.,
AGAINST THE AWARDS MADE UNDER AN RFP ISSUED BY THE AMMUNITION
PROCUREMENT AND SUPPLY AGENCY FOR METAL PROJECTILE PARTS, THE COMP.
GEN. ADVISES THAT ALTERNATIVE PROCUREMENT APPROACHES SHOULD BE
CONSIDERED TO ENCOURAGE FAVORABLE PRICE PROPOSALS IN COMBINATION AWARD
SITUATIONS.
TO MR. SECRETARY:
THIS REFERS TO THE LETTERS OF DECEMBER 21, 1970, AND FEBRUARY 11,
1971, WITH ATTACHMENTS, FROM HEADQUARTERS, ARMY MATERIEL COMMAND,
AMCGC-P, CONCERNING A PROTEST BY CHAMBERLAIN MANUFACTURING CORPORATION,
AGAINST THE AWARDS OF CONTRACTS UNDER REQUEST FOR PROPOSALS (RFP) NO.
DAAA09-71-R-0018, ISSUED ON AUGUST 26, 1970, BY THE AMMUNITION
PROCUREMENT AND SUPPLY AGENCY (APSA), DEPARTMENT OF THE ARMY, FOR THE
PROCUREMENT OF METAL PARTS FOR 155MM PROJECTILES.
ENCLOSED IS A COPY OF OUR LETTER OF TODAY DENYING THE CHAMBERLAIN
PROTEST. HOWEVER, WE BELIEVE THAT CONSIDERATION SHOULD BE GIVEN TO
MEANS FOR ENCOURAGING FAVORABLE PRICE PROPOSALS IN PROCUREMENTS
INVOLVING COMBINATION AWARDS OF THE TYPE CONSIDERED HERE. IN THIS
CONNECTION, IN B-153687, JULY 7, 1964, A PRIOR APSA PROCUREMENT
INVOLVING A SOMEWHAT SIMILAR FACTUAL SITUATION UNDER AN ADVERTISED
PROCUREMENT, THE ADMINISTRATIVE REPORT STATES THAT CONSIDERATION WAS
GIVEN TO THE POSSIBILITY OF MAKING AN AWARD FOR THE LARGER QUANTITY TO
THE LOWER OFFEROR AND OBTAINING THE BALANCE BY SUCH ALTERNATIVES AS THE
EXERCISE OF CERTAIN OPTION CLAUSES OR BY NEGOTIATION OR BY ISSUANCE OF A
NEW INVITATION FOR THAT QUANTITY. EACH OF THESE ALTERNATIVES WAS
DETERMINED NOT TO BE FEASIBLE IN THAT CASE EITHER BECAUSE THE RESULTING
DELAY IN DELIVERIES WOULD HAVE MADE IT IMPOSSIBLE FOR THE PROCURING
ACTIVITY TO MEET ITS COMMITMENTS FOR THE ITEMS OR FOR SIMILAR PRACTICAL
CONSIDERATIONS.
IN A CASE OF THIS TYPE, WE BELIEVE IT MIGHT BE ADVISABLE TO CONSIDER
AND, WHERE FEASIBLE, ADOPT ONE OR MORE OF THE ALTERNATIVE APPROACHES
CONSIDERED IN THE EARLIER CASE. APPROPRIATE CLAUSES COULD BE INCLUDED
IN THE INITIAL SOLICITATION ADVISING OFFERORS OF SUCH POSSIBILITIES. WE
WOULD APPRECIATE YOUR VIEWS ON THE MATTER.
B-171472, MAY 11, 1971
BID PROTEST - CANCELLED IFB - UNREASONABLE PRICES
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST THE
CANCELLATION OF AN IFB ISSUED BY THE NAVAL AIR ENGINEERING CENTER,
PHILADELPHIA, PA., FOR PROCUREMENT OF 24 PANEL ASSEMBLIES FOR AIRPORT
CONTROL LIGHTING.
ALTHOUGH THE ORIGINAL IFB WAS CANCELLED FOR REVISION IN
SPECIFICATIONS BASED IN PART UPON THE CONTRACTING OFFICER'S ERRONEOUS
BELIEF THAT AN OUTER CASE WAS NOT A SEPARATE ITEM WHICH COULD BE
PROCURRED INDEPENDENTLY, THE BIDS ON THE IFB WERE ALSO UNREASONABLY HIGH
AND 10 U.S.C. 2305(C) PROVIDES THAT ALL BIDS SOLICITED IN RESPONSE TO AN
ADVERTISED SOLICITATION MAY BE REJECTED WHEN IT IS IN THE PUBLIC
INTEREST TO DO SO. ALSO, ASPR 2-404.1(B)(VI) STATES THAT CANCELLATION
AFTER BID OPENING BUT PRIOR TO AWARD IS JUSTIFIED WHERE "ALL OTHERWISE
ACCEPTABLE BIDS RECEIVED ARE AT UNREASONABLE PRICES". ACCORDINGLY, THE
PROTEST MUST BE DENIED.
TO NELSON ELECTRIC:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 1, 1970,
PROTESTING THE CANCELLATION OF INVITATION FOR BIDS (IFB)
N00156-71-B-0028, ISSUED BY THE NAVAL AIR ENGINEERING CENTER,
PHILADELPHIA, PENNSYLVANIA.
THE INVITATION WAS ISSUED SEPTEMBER 24, 1970, AND REQUESTED OFFERS
FOR THE PROPOSED PROCUREMENT OF 24 PANEL ASSEMBLIES FOR AIRPORT CONTROL
LIGHTING, MILITARY STANDARD (MS) PART NO. MS23007-33, TOGETHER WITH 1
LOT OF DATA THEREFORE. BIDS WERE OPENED ON OCTOBER 24, 1970, AND NEO
FLASHER ELECTRONICS, INC., WAS THE LOW BIDDER AND YOUR COMPANY WAS
SECOND LOW BIDDER. DURING CONSIDERATION AND EVALUATION OF THE BIDS THE
REQUIRING ACTIVITY ADVISED THE PROCURING OFFICE THAT THE REQUIREMENT WAS
FOR MS PART NO. 23007-3, A PANEL ASSEMBLY WITH OUTER COVER, IN LIEU OF
NO. 23007-33, WITHOUT THE OUTER COVER. THE CONTRACT REVIEW BOARD
AUTHORIZED CANCELLATION OF IFB-0028 ON GROUNDS OF FAILURE TO STATE
MINIMUM GOVERNMENT REQUIREMENTS, AND THE RESULTING NECESSITY FOR A
CHANGE IN SPECIFICATIONS. THE IFB WAS CANCELLED, CITING REVISION IN
SPECIFICATIONS AS THE REASON FOR CANCELLATION. THE REVISED REQUIREMENT
WAS READVERTISED UNDER IFB NUMBER N00156-71-B-0146. TEN BIDS WERE
RECEIVED AND OPENED ON DECEMBER 15, 1970. THE LOW BIDDER WAS AUDIO
EQUIPMENT CO., INC. YOUR BID WAS FIFTH LOWEST.
YOU PROTEST THE CANCELLATION OF IFB-0028 ON THE BASIS THAT THE CHANGE
IN PANEL ASSEMBLIES WAS NOT A REVISION IN SPECIFICATIONS, BUT RATHER THE
ADDITION OF A NEW ITEM. YOU THEREFORE REQUEST THAT THE PROCUREMENT
AGENCY BE DIRECTED TO MAKE AN AWARD FOR THE 24 PANELS TO THE "LOW,
RESPONSIVE AND RESPONSIBLE BIDDER," AND THAT THE OUTER CASE BE PROCURED
ON A SEPARATE SOLICITATION. YOU STATE ALSO THAT YOU ATTEMPTED TO MEET
WITH THE CONTRACTING OFFICER OR HIS LEGAL COUNSEL TO DISCUSS THE ISSUE
BUT WERE PREVENTED FROM DOING SO BY THE BUYER ON THE BASIS THAT THERE
WAS NO OBLIGATION TO MEET WITH YOU.
RESPONDING TO THE LATTER ALLEGATION FIRST, THE PROCURING AGENCY
STATES THAT YOUR PERSONNEL WERE NEVER PREVENTED FROM MEETING WITH THE
NAVAIR ENG CEN CONTRACTING OFFICER AND COUNSEL, AND THAT NO SUCH MEETING
WAS EVER REQUESTED BY YOU. SINCE YOU HAVE SUBMITTED NO EVIDENCE TO
SUBSTANTIATE YOUR ALLEGATION, WE MUST ACCEPT THE REPORT OF THE PROCURING
AGENCY AS BEING CORRECT.
WITH RESPECT TO CANCELLATION OF THE IFB, REPORTS FROM THE DEPARTMENT
OF THE NAVY ADVISE THAT SUCH ACTION WAS BASED IN PART UPON THE
CONTRACTING OFFICER'S ERRONEOUS BELIEF THAT THE OUTER CASE IS NOT A
SEPARATE ITEM OR SPARE PART WHICH CAN BE PROCURED INDEPENDENTLY, AND
THAT THE SPECIFICATION THEREFORE DID NOT REFLECT THE GOVERNMENT'S
MINIMUM REQUIREMENTS AND HAD TO BE CHANGED. IT IS ALSO REPORTED THAT
THE CONTRACTING OFFICER WAS PROMPTED TO CANCEL IFB-0028 AND READVERTISE
BECAUSE A CURSORY EXAMINATION INDICATED THAT THE BIDS RECEIVED UNDER THE
INITIAL IFB WERE UNREASONABLY HIGH BECAUSE LOWER PRICES HAD BEEN
RECENTLY OBTAINED IN OTHER PROCUREMENTS FOR THE PANEL ASSEMBLY WITH THE
OUTER CASE.
THE CONCLUSION THAT BIDS WERE UNREASONABLY HIGH IS SUBSTANTIATED BY
THE BIDS ON THE READVERTISEMENT (IFB N00156-71-B-0146) COVERING
PROCUREMENT OF THE PANEL ASSEMBLY WITH OUTER CASE, WHICH ARE
SIGNIFICANTLY LOWER THAN THOSE RECEIVED UNDER THE FIRST IFB. THUS, NEO
FLASHER, WHO WAS LOW BID UNDER THE FIRST SOLICITATION AT $485 PER UNIT,
LATER CLAIMED A MISTAKE IN BID AND REQUESTED A PRICE INCREASE TO $585.00
PER UNIT PLUS $300.00 FOR DATA. YOUR BID THEREON (WITHOUT OUTER COVER)
WAS $779.00 PER UNIT PLUS $500.00 FOR DATA. IN THIS CONNECTION, THE
CONTRACTING OFFICER FOUND THAT NEO FLASHER HAD PRESENTED SUFFICIENT
EVIDENCE OF ITS MISTAKE AND OF THE BID ACTUALLY INTENDED. THUS, IF THE
ORIGINAL SOLICITATION HAD NOT BEEN CANCELLED, NEO FLASHER, IF DETERMINED
TO BE A RESPONSIBLE BIDDER, WOULD HAVE BEEN AWARDED THE CONTRACT AT
$585.00 PER UNIT.
THE LOW BIDDER UNDER THE RESOLICITATION WAS AUDIO EQUIPMENT CO., WITH
A BID OF $302.51 PER UNIT WITH NO CHARGE FOR DATA, AND THE SECOND LOW
BIDDER WAS PALMER ELECTRIC MANUFACTURING CO., WITH A BID OF $398.27 PER
UNIT AND NO CHARGE FOR DATA. WHILE THE TWO LOW BIDDERS ON THE
RESOLICITATION, AUDIO AND PALMER, HAVE CLAIMED MISTAKES IN THEIR BIDS
AND HAVE REQUESTED UPWARD PRICE ADJUSTMENTS, (AUDIO FROM $302.51 TO
$502.51 PER UNIT, AND PALMER FROM $389.27 PER UNIT TO $509.59 PER UNIT
WITH NO CHARGE FOR THE DATA PACKAGE IN EACH INSTANCE) ONLY AUDIO'S UNIT
PRICE HAS BEEN CORRECTED TO $502.51, WHILE PALMER'S CLAIMED MISTAKE HAS
BEEN DISALLOWED.
A COMPARISON OF THE LOW BIDS UNDER EACH SOLICITATION REVEALING THE
DISPARITY IN PRICES AND ILLUSTRATING THE UNREASONABLENESS OF THE PRICES
OBTAINED UNDER THE CANCELLED IFB FOLLOWS:
IFB N00156-71-B-0028
(PANEL ASSY. WITHOUT OUTER CASE)
NEO FLASHER ELECTRONICS - $585.00 PER UNIT (AS CORRECTED X
TWENTY-FOUR (24) UNITS = $14,040.00 PLUS COST OF 24 OUTER CASES
(PROCURED SEPARATELY)
NELSON ELECTRIC - $779.00 PER UNIT X TWENTY-FOUR (24) UNITS =
$18,696.00 PLUS $500.00 (DATA) = $19,196.00 PLUS COST OF 24 OUTER CASES
(PROCURED SEPARATELY)
IFB N00156-71-B-0146
(PANEL ASSY. WITH OTHER CASE)
AUDIO EQUIPMENT CO. - $502.51 PER UNIT (AS CORRECTED) X TWENTY-FOUR
(24) UNITS (WITH OUTER CASE) = $12,060.24
THE ABOVE FIGURES SHOW THAT IF THE RESOLICITATION IS CANCELLED AND
THE ORIGINAL SOLICITATION IS RESTORED, THE TOTAL COST TO THE GOVERNMENT
WOULD BE $14,040.00, PLUS COST OF 24 OUTER CASES (NEO FLASHER) OR
$19,196.00 PLUS COST OF 24 OUTER CASES (NELSON). UNDER THE
RESOLICITATION (PANEL ASSEMBLIES WITH OUTER CASES), THE GOVERNMENT'S
TOTAL COST WOULD BE $12,060.24 (AUDIO).
10 U.S.C. 2305(C) PROVIDES THAT ALL BIDS SOLICITED IN RESPONSE TO AN
ADVERTISED SOLICITATION MAY BE REJECTED WHEN IT IS IN THE PUBLIC
INTEREST TO DO SO. ALSO, PARAGRAPH 10(B) OF THE INSTRUCTIONS TO BIDDERS
PROVIDES THAT THE GOVERNMENT MAY, WHEN IN ITS INTEREST, REJECT ANY OR
ALL BIDS. IN THIS CONNECTION, ASPR 2-404.1 PROVIDES THAT AFTER BIDS
HAVE BEEN OPENED, CANCELLATION OF A SOLICITATION IS PERMISSIBLE IF THERE
IS A COMPELLING REASON TO REJECT ALL BIDS. ASPR 2-404.1(B)(VI) STATES
THAT CANCELLATION OF A SOLICITATION AFTER BID OPENING BUT PRIOR TO
AWARD, IS JUSTIFIED WHERE "ALL OTHERWISE ACCEPTABLE BIDS RECEIVED ARE AT
UNREASONABLE PRICES."
THE DETERMINATION OF WHETHER A LOW ACCEPTABLE BID IS IN EXCESS OF THE
AMOUNT FOR WHICH THE GOVERNMENT SHOULD BE ABLE TO OBTAIN THE ITEMS OR
SERVICES SOUGHT IS THE FUNCTION OF THE ADMINISTRATIVE AGENCY. IN THE
ABSENCE OF BAD FAITH, OR ARBITRARY OR CAPRICIOUS ACTION BY CONTRACTING
OFFICIALS, WE WILL NOT QUESTION THE REJECTION OF A LOW BID IF THE BID
PRICE IS CONSIDERED TO BE EXCESSIVE. B-168972, APRIL 14, 1970;
B-166679, JUNE 10, 1969, AND CASES CITED THEREIN; B-159865, OCTOBER 6,
1966.
IN THIS REGARD WE HAVE CONSISTENTLY HELD THAT CONTRACTING OFFICERS
SHOULD REVIEW THE PROCUREMENT HISTORY OF AN ITEM BEING PROCURED TO
DETERMINE WHETHER OR NOT BID PRICES RECEIVED ON A SUBSEQUENT
SOLICITATION FOR THE SAME ITEM ARE UNREASONABLE AND EXCESSIVE. SEE
B-167299, AUGUST 11, 1969; B-156115, MAY 4, 1965, AND B-153974, JULY
14, 1964.
MORE SPECIFICALLY, WE HELD IN B-147154, SUPRA, AS FOLLOWS:
" *** THE AUTHORITY TO REJECT BIDS IS NOT ORDINARILY SUBJECT TO
REVIEW BY THIS OFFICE, AND WE HAVE SPECIFICALLY HELD THAT WHEN IT IS
ADMINISTRATIVELY DETERMINED THAT THE LOWEST ACCEPTABLE BID IS IN EXCESS
OF THE AMOUNT FOR WHICH THE GOVERNMENT SHOULD BE ABLE TO PROCURE THE
PARTICULAR SUPPLIES, A REJECTION OF ALL BIDS AND A SOLICITATION OF NEW
BIDS IS A PROPER EXERCISE OF ADMINISTRATIVE DISCRETION *** ."
ON THE RECORD, WE FIND NO PROPER BASIS TO QUESTION THE DETERMINATION
OF THE CONTRACTING OFFICER THAT THE PRICES BID UNDER IFB-6028 WERE
UNREASONABLE AND EXCESSIVE IN AMOUNT.
ACCORDINGLY, YOUR PROTEST IS DENIED.
B-171573, MAY 11, 1971
BID PROTEST - SURPLUS SALES CONTRACT
DECISION DENYING PROTEST AGAINST DETERMINATION MADE PURSUANT TO DOD
MANUAL 4160.21-M, PART 3, CHAPTER X WHICH ALLOWED AN ERRONEOUS BID
SUBMITTED BY STAINLESS ALLOY & METAL CORP., TO BE WITHDRAWN, AND AN
ERRONEOUS BID SUBMITTED BY ASSOCIATED ALLOYS, INC., TO BE CORRECTED, ON
A SEALED BID SALE OF SURPLUS MINESWEEPING CABLE AND OTHER ITEMS BY THE
DEFENSE SURPLUS SALES OFFICE.
BECAUSE BIDS ON SCRAP METAL GENERALLY DO NOT VARY GREATLY, THE
CONTRACTING OFFICER WAS CHARGEABLE WITH NOTICE OF A MISTAKE IN THE
STAINLESS BID WHICH WAS 2.3 TIMES HIGHER THAN THE NEXT HIGH BID
SUBMITTED BY PROTESTANT; WITHDRAWAL OF THIS BID WAS THEREFORE PROPER.
FURTHER, ALTHOUGH THE WORKSHEETS SUBMITTED BY ASSOCIATED DO NOT
ESTABLISH THE INTENDED PRICE, THEY CLEARLY AND CONVINCINGLY ESTABLISH
THAT EITHER $48,122.52 OR $47,106.68 WAS INTENDED. BECAUSE ASSOCIATED'S
BID CORRECTED TO EITHER PRICE WOULD STILL BE THE HIGHEST AND NOT
DISPLACE ANY OTHER BIDDER, THE CORRECTION WAS PROPERLY ALLOWED. ALSO,
PARAGRAPHS 20(A)(1) AND 20(A)(3) OF THE GENERAL SALES TERMS AND
CONDITIONS WERE NOT VIOLATED BY THE PARTICIPATION OF ONE INDIVIDUAL IN
THE BIDS OF BOTH STAINLESS AND ASSOCIATED BECAUSE THESE PROVISIONS DO
NOT RELATE TO BIDS SUBMITTED BY AFFILIATED COMPANIES.
ACCORDINGLY, THE PROTEST IS DENIED.
TO HOOF, SHUCKLIN & HARRIS
REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 30, 1970, ON BEHALF OF
YOUR CLIENT, LEONARD A. STRANDLEY, PROTESTING THE PROPOSED SALE TO
ASSOCIATED ALLOYS, INC., OF ITEM 80 PURSUANT TO SEALED BID SALE 44-1060
BY THE DEFENSE SURPLUS SALES OFFICE, NAVAL SUPPLY CENTER, OAKLAND,
CALIFORNIA.
BY WAY OF FACTUAL BACKGROUND, THIS PROTEST ENSUED FROM DETERMINATIONS
MADE PURSUANT TO DOD MANUAL 4160.21-M, PART 3, CHAPTER X (SET OUT
BELOW), THAT AN ERRONEOUS BID SUBMITTED BY STAINLESS ALLOY & METAL
CORPORATION (STAINLESS) COULD BE WITHDRAWN, AND AN ERRONEOUS BID
SUBMITTED BY ASSOCIATED ALLOYS, INC. (ASSOCIATED) COULD BE CORRECTED.
STAINLESS SUBMITTED A BID ON ITEM 80, SURPLUS MINESWEEPING CABLE
CONTAINING COPPER AND ALUMINUM WIRE, IN THE AMOUNT OF $48,122.52 WHICH
WAS APPROXIMATELY 2.3 TIMES HIGHER THAN THE NEXT HIGH BID OF $20,664.00
SUBMITTED BY YOUR CLIENT, MR. STRANDLEY.
THE "ALL OR NONE BID" OF ASSOCIATED FOR ITEMS 70, 71, 72, 74, 80 AND
81 WAS $78,788.88 COMPARED TO SECOND HIGH INDIVIDUAL BIDS FOR SUCH
PROPERTY WHICH TOTALLED $45,266.03.
IMMEDIATELY UPON THE CONTRACTING OFFICER'S ANNOUNCEMENT THAT THE
OPENING OF BIDS HAD BEEN COMPLETED, REPRESENTATIVES OF STAINLESS AND
ASSOCIATED ALLEGED THAT ERRORS HAD BEEN MADE AND THAT THEY WERE COMPLEX
AND WOULD BE EXPLAINED SUBSEQUENTLY IN WRITING.
BY LETTER DATED OCTOBER 29, 1970, TWO DAYS FOLLOWING THE BID OPENING,
MR. WELTMAN STATED THAT THE STAINLESS BID HAD BEEN SUBMITTED IN ERROR IN
THAT NO BID WAS INTENDED IN THAT NAME; THAT THE ERROR WAS DISCOVERED
JUST MOMENTS PRIOR TO THE BID OPENING; AND CONSEQUENTLY A BID WAS THEN
SUBMITTED IN THE NAME OF ASSOCIATED (IN WHICH NAME HE HAD INTENDED TO
BID) BUT THAT THAT BID ALSO WAS ERRONEOUS AS TO THE AMOUNT.
MR. WELTMAN'S LETTER RELATED THAT THE SUM OF $48,122.52 BID BY
STAINLESS ON ITEM 80 WAS THE TOTAL ALL OR NONE AMOUNT WHICH HE AND HIS
COLLEAGUES INTENDED TO BID FOR ALL OF THE ITEMS, I.E., 70, 71, 72, 74,
80 AND 81. HE EXPLAINED THAT THE ORIGINAL INTENTION WAS TO BID THESE
ITEMS ON STAINLESS, ASSOCIATED'S MONTREAL AFFILIATE, BUT AFTER PARTIALLY
FILLING IN THE BID HE REMEMBERED THAT AN EXPORT PERMIT WAS REQUIRED TO
SEND THIS MERCHANDISE OUT OF THE UNITED STATES AND THE PERMIT WAS IN
ASSOCIATED'S NAME. THIS IS ALLEGED TO BE WHY ONLY ITEM 80 WAS LISTED ON
THIS BID INSTEAD OF ITEMS 70, 71, 72, 74, 80 AND 81 ON AN ALL OR NONE
BASIS. HE THEREUPON PUT THE STAINLESS BID ASIDE AND PREPARED THE
ASSOCIATED BID.
DUE TO THE PRESSURES OF TIME, MR. WELTMAN ADVISES THAT HE AND HIS
COLLEAGUE COMMITTED ERRORS IN TRANSPOSING FIGURES FROM THEIR WORKSHEETS
AND PUT THE PRICE OF $78,788.88, INSTEAD OF $48,122.52, AS THE ALL OR
NONE BID BY ASSOCIATED. THE FIGURE OF $78,788.88 INCLUDED $48,122.52
PLUS ADDITIONAL AMOUNTS SHOWN ON THE WORKSHEET FOR FREIGHT AND
ANTICIPATED PROFIT.
IT WAS UPON THIS BASIS THAT HE REQUESTED PERMISSION, PURSUANT TO
CHAPTER X, AS QUOTED BELOW, TO WITHDRAW THE STAINLESS BID AND MODIFY THE
ASSOCIATED BID FROM $78,788.88 TO THE $48,122.52 APPEARING ON HIS
WORKSHEETS AS THE INTENDED BID ON ASSOCIATED. THESE WORKSHEETS WERE
SUBMITTED UPON THE REQUEST OF THE CONTRACTING OFFICER.
IN TWO LETTERS DATED DECEMBER 9, 1970, THE ASSISTANT COUNSEL, TO WHOM
AUTHORITY WAS DELEGATED (BY CHAPTER X, SUBSECTION 3(B)) TO MAKE SUCH
DETERMINATIONS, DECLARED THAT HAVING FOUND:
(1) CLEAR AND CONVINCING EVIDENCE OF MISTAKE IN THE STAINLESS BID ON
ITEM 80, HE DETERMINED THAT IT MAY BE WITHDRAWN.
(2) CLEAR AND CONVINCING EVIDENCE, REGARDING THE ASSOCIATED BID, BOTH
AS TO THE EXISTENCE OF THE ERROR AND THE BID INTENDED, HE DETERMINED
THAT THE ALL OR NONE BID OF ASSOCIATED MIGHT BE CORRECTED TO $48,122.52.
THE DETERMINATION TO CORRECT THE LATTER BID WAS MADE WITH REGARD TO
CHAPTER X, SUBSECTION 3(A)(2), WHICH PERMITS CORRECTION AS OPPOSED TO
WITHDRAWAL IF THE BID, BOTH AS CORRECTED AND UNCORRECTED, IS THE HIGHEST
RECEIVED. SINCE THE SECOND HIGH INDIVIDUAL BIDS TOTALED $45,266.03,
CORRECTION OF THE ASSOCIATED BID DID NOT DISPLACE ANY OTHERWISE HIGHER
BIDDERS.
YOU CONTEND THAT THE DECISION TO PERMIT CORRECTION OF THE BID OF
ASSOCIATED AND WITHDRAWAL OF THE BID OF STAINLESS VIOLATES SEVERAL OF
THE GENERAL SALES TERMS AND CONDITIONS, BEGINNING WITH PARAGRAPH 3, BY
WHICH THE GOVERNMENT RESERVES THE RIGHT TO REJECT THOSE BIDS UNDER WHICH
A BIDDER MIGHT TAKE ADVANTAGE OF THE GOVERNMENT OR OTHER BIDDERS.
YOU FURTHER ALLEGE THAT PARAGRAPH 16, PROVIDING THAT ORAL STATEMENTS
OF GOVERNMENT REPRESENTATIVES WHICH CHANGE THE INVITATION CONFER NO
RIGHTS UPON BIDDERS, WAS VIOLATED WHEN THE INDIVIDUAL REPRESENTING BOTH
ASSOCIATED AND STAINLESS INTERRUPTED THE READING OF HIS BIDS TO ADVISE
THE SALES CONTRACTING OFFICER'S REPRESENTATIVE OF A MISTAKE IN HIS BIDS
AND WAS INSTRUCTED TO SEE THE SALES CONTRACTING OFFICER WHO REQUESTED
THAT HE FURNISH A LETTER EXPLAINING THE PURPORTED MISTAKE.
ADDITIONALLY, YOU CLAIM THAT PARAGRAPHS 20(A)(1) AND 20(A)(3),
STIPULATING THAT BID PRICES SHALL BE INDEPENDENTLY COMPUTED SO AS TO
NEGATE ANY PURPOSE OF RESTRICTING COMPETITION, AND THAT NO ATTEMPT SHALL
BE MADE BY A BIDDER TO INDUCE ANOTHER FIRM TO SUBMIT OR WITHHOLD A
PROPOSAL FOR THE PURPOSE OF RESTRICTING COMPETITION, WERE TRANSGRESSED
SINCE MR. JULIUS WELTMAN WHO REPRESENTED BOTH ASSOCIATED AND STAINLESS,
AND WHO WAS PRESIDENT OF ONE AND VICE-PRESIDENT OF THE OTHER, SIGNED
BOTH BIDS AND DECLARED AN ERROR IN EACH BID AT THE BID OPENING.
FINALLY, YOU ALLEGE VIOLATION OF ARTICLES AB AND AC OF THE SPECIAL
SEALED BID CONDITIONS PROHIBITING MODIFICATION OR WITHDRAWAL OF BIDS
SUBSEQUENT TO THE TIME SET FOR BID OPENING. CONSEQUENTLY, YOU SUBMIT,
THE PROPOSED SALE TO ASSOCIATED SHOULD BE CANCELLED WITH THE AWARD OF
ITEM 80 TO YOUR CLIENT AS THE NEXT RESPONSIBLE BIDDER.
WITH RESPECT TO YOUR CONTENTION THAT PERMISSION TO WITHDRAW THE
STAINLESS BID AND TO CORRECT THE ASSOCIATED BID VIOLATED PARAGRAPH 3 OF
THE GENERAL SALE TERMS AND CONDITIONS, IT IS OUR OPINION THAT THIS
PROVISION OF THE SOLICITATION APPLIES ONLY TO BIDS WHICH WOULD OTHERWISE
BE PROPERLY FOR ACCEPTANCE, RATHER THAN TO BIDS ON WHICH ERROR IS
ALLEGED AND CAN BE SHOWN. ADDITIONALLY, IT SHOULD BE NOTED THAT
REJECTION OF BIDS UNDER PARAGRAPH 3 IS WITHIN THE SOUND DISCRETION OF
THE CONTRACTING OFFICER, AND NO MANDATORY OBLIGATION IS IMPOSED THEREBY
TO REJECT A BID EVEN IF IT SHOULD FALL WITHIN THE PURVIEW OF PARAGRAPH
3. WE THEREFORE SEE NO BASIS FOR CONCLUDING THAT THE PROVISIONS OF
PARAGRAPH 3 WERE VIOLATED BY THE PERMISSION TO WITHDRAW AND TO CORRECT
IN THE INSTANT CASE.
CONCERNING YOUR BELIEF THAT PARAGRAPH 16 WAS VIOLATED WHEN THE SALES
CONTRACTING OFFICER ADVISED THE REPRESENTATIVE OF ASSOCIATED AND OF
STAINLESS TO SUBMIT A LETTER EXPLAINING THE ERRORS IN THESE BIDS, WE ARE
UNABLE TO FIND ANY PROVISION OF THE INVITATION RELATING TO PROCEDURES TO
BE FOLLOWED IN PROCESSING ALLEGATIONS OF MISTAKES IN BIDS. IN VIEW
THEREOF, AND SINCE THE REQUEST FOR SUBMISSION OF A LETTER EXPLAINING THE
ERROR IS CONSISTENT WITH THE PROVISIONS OF THE REGULATIONS APPLICABLE TO
MISTAKES IN BIDS, AS SET OUT BELOW, WE FIND NO MERIT IN THIS PORTION OF
YOUR PROTEST.
WITH RESPECT TO YOUR CONTENTION THAT PARAGRAPHS 20(A)(1) AND (3) WERE
VIOLATED BY MR. WELTMAN'S PARTICIPATION IN THE BIDS OF BOTH STAINLESS
AND ASSOCIATED, WE DO NOT CONSTRUE THOSE PROVISIONS AS RELATING TO BIDS
SUBMITTED BY AFFILIATED COMPANIES. FURTHER, WE ARE INCLINED TO ACCEPT
THE EXPLANATION, AS SET OUT ABOVE, THAT THE BID OF STAINLESS WAS
SUBMITTED IN ERROR. IN VIEW THEREOF, AND OF THE IMMEDIATE ALLEGATION OF
ERROR UPON BID OPENING, WE MUST REJECT YOUR CONTENTION THAT ANY INTENT
TO RESTRICT COMPETITION CAN BE READ INTO THE PREPARATION OF BOTH BIDS BY
MR. WELTMAN, OR INTO HIS SUBSEQUENT REQUEST FOR WITHDRAWAL OF THE
STAINLESS BID.
CONCERNING YOUR ALLEGATION THAT ARTICLES AB AND AC OF THE SPECIAL
SEALED BID CONDITIONS HAVE BEEN VIOLATED, YOUR ATTENTION IS DIRECTED TO
DOD MANUAL 4160.21-M, PART 3, CHAPTER X, SUBSECTION 3A, WHICH IS
APPLICABLE TO MISTAKES IN BIDS, AND WOULD THEREFORE BE FOR CONSIDERATION
INSTEAD OF ARTICLES AB AND AC, WHICH RELATE TO MODIFICATIONS AND
WITHDRAWALS OF BIDS. SUBSECTION 3A READS, IN PERTINENT PART, AS
FOLLOWS:
"3. OTHER MISTAKES.
"A. THE DEFENSE SUPPLY AGENCY (DSA) AND THE MILITARY DEPARTMENTS ARE
AUTHORIZED TO MAKE THE FOLLOWING ADMINISTRATIVE DETERMINATIONS IN
CONNECTION WITH MISTAKES IN BIDS, OTHER THAN APPARENT CLERICAL MISTAKES,
ALLEGED AFTER OPENING OF BIDS AND PRIOR TO AWARD:
"(1) WHERE THE BIDDER REQUESTS PERMISSION TO WITHDRAW A BID AND CLEAR
AND CONVINCING EVIDENCE ESTABLISHES THE EXISTENCE OF A MISTAKE, A
DETERMINATION PERMITTING THE BIDDER TO WITHDRAW HIS BID.
"(2) IF THE EVIDENCE IS CLEAR AND CONVINCING BOTH AS TO THE EXISTENCE
OF THE MISTAKE AND AS TO THE BID ACTUALLY INTENDED, AND IF THE BID, BOTH
AS CORRECTED AND AS UNCORRECTED, IS THE HIGHEST RECEIVED, A
DETERMINATION MAY BE MADE TO CORRECT THE BID AND NOT PERMIT ITS
WITHDRAWAL.
"(3) WHERE THE BIDDER REQUESTS PERMISSION TO CORRECT A MISTAKE IN HIS
BID AND CLEAR AND CONVINCING EVIDENCE ESTABLISHES BOTH THE EXISTENCE OF
A MISTAKE AND THE BID ACTUALLY INTENDED, A DETERMINATION PERMITTING THE
BIDDER TO CORRECT THE MISTAKE; PROVIDED THAT, IN THE EVENT CORRECTION
WOULD RESULT IN DISPLACING ONE OR MORE HIGHER BIDS, THE DETERMINATION
WILL NOT BE MADE UNLESS THE EXISTENCE OF THE MISTAKE AND BID ACTUALLY
INTENDED ARE ASCERTAINABLE SUBSTANTIALLY FROM THE INVITATION AND THE BID
ITSELF. IF THE EVIDENCE IS CLEAR AND CONVINCING ONLY AS TO THE MISTAKE,
BUT NOT AS TO THE INTENDED BID, A DETERMINATION PERMITTING THE BIDDER TO
WITHDRAW HIS BID."
THE PROCURING ACTIVITY HAS VENTURED ITS OPINION THAT OBVIOUS ERRORS
EXISTED IN BOTH THE STAINLESS AND ASSOCIATED BIDS SINCE ALL OF THE ITEMS
CONSISTED OF SCRAP. IN B-170024, JUNE 23, 1970, OUR OFFICE ACKNOWLEDGED
THAT BIDS ON SCRAP METAL GENERALLY DO NOT VARY GREATLY AND THUS A UNIT
BID PRICE OF $0.40836, CONSIDERED BESIDE THE NEXT HIGH BID OF $0.1411,
CONSTITUTED SUCH A SUBSTANTIAL DISPARITY AS TO PLACE A CONTRACTING
OFFICER ON CONSTRUCTIVE NOTICE OF A MISTAKE IN BID. IT WAS LIKEWISE
NOTED IN B-149660, SEPTEMBER 21, 1962, THAT A BID FOR SCRAP WHICH WAS
EXCESSIVE WHEN COMPARED TO OTHER BIDS RECEIVED, WAS SUFFICIENT TO
ESTABLISH A MISTAKE.
IT WAS FURTHER FOUND BY A DEFENSE LOGISTICS SERVICES CENTER
SPECIALIST, THROUGH AN INDEPENDENT ANALYSIS THAT THE ESTIMATED VALUE OF
THE ITEMS INCLUDED IN THE ALL OR NONE BID WAS $46,729.70.
IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT THE CONTRACTING
OFFICER WAS CHARGEABLE WITH NOTICE OF A MISTAKE IN THE STAINLESS BID;
THAT SUCH NOTICE PRECLUDED HIM FROM MAKING A BINDING AWARD TO STAINLESS;
AND THAT HE WAS THEREFORE JUSTIFIED IN PERMITTING WITHDRAWAL OF THE
STAINLESS BID.
THERE REMAINS ONLY THE QUESTION OF WHETHER THE BID SUBMITTED BY
ASSOCIATED MAY BE CORRECTED FROM $78,788.88 TO $48,122.52, AS REQUESTED
BY THE BIDDER. AS INDICATED BY SUBSECTION 3A(3), QUOTED ABOVE, A BID
MAY BE CORRECTED IF THE BIDDER SUBMITS CLEAR AND CONVINCING EVIDENCE
WHICH ESTABLISHES THAT A MISTAKE HAS BEEN MADE AND THE BID ACTUALLY
INTENDED. THE WORKSHEETS SUBMITTED BY ASSOCIATED SHOW VARIOUS PRICE
COMPUTATIONS ON AN INDIVIDUAL ITEM BASIS FOR ITEMS 70, 71, 72, 74, 80
AND 81. WHAT APPEAR TO BE THE FINAL COMPUTATIONS ON EACH ITEM WERE THEN
TOTALED TO THE SUM OF $47,106.68.
THE WORKSHEETS ALSO CONTAIN VARIOUS COMPUTATIONS REFLECTING UNIT
PRICES MULTIPLIED BY THE 82 UNITS IN ITEM 80, WHICH CULMINATE IN A UNIT
PRICE OF $586.86 MULTIPLIED BY 82 FOR A TOTAL OF $48,122.52, TOGETHER
WITH A NOTATION "TO INCLUDE ALL THE 70-71-72-74-80-81." THESE ARE THE
UNIT AND TOTAL PRICES INCLUDED IN THE BID SUBMITTED BY STAINLESS.
FINALLY, THE WORKSHEETS SHOW A COMPUTATION WHICH BEGINS WITH THE
FIGURE $48,122.52, ADDS VARIOUS AMOUNTS FOR WORK, FREIGHT AND ESTIMATED
PROFIT, AND RESULTS IN A TOTAL AMOUNT OF $78,788.88, WHICH IS LABELED
"OUR VALUE" AND IS THE AMOUNT OF THE BID SUBMITTED BY ASSOCIATED.
FROM OUR ANALYSIS OF THESE WORKSHEETS, WE ARE UNABLE TO SAY THAT THEY
CLEARLY AND CONVINCINGLY ESTABLISH THAT ASSOCIATED INTENDED TO BID
$48,122.52 AS CLAIMED. WE DO BELIEVE, HOWEVER, THAT THE WORKSHEETS
ESTABLISH THAT $78,788.88 WAS NOT THE INTENDED BID PRICE, AND THAT THEY
CLEARLY AND CONVINCINGLY ESTABLISH THAT ASSOCIATED INTENDED TO BID
EITHER $48,122.52 OR $47,106.68. SINCE THE BID SUBMITTED BY STAINLESS
WAS IN THE AMOUNT OF $48,122.52, AND SINCE ASSOCIATED'S BID CORRECTED TO
EITHER PRICE WOULD STILL BE THE HIGHEST BID AND WOULD THEREFORE NOT
DISPLACE ANY OTHER BIDDER, IT IS OUR OPINION THAT THE BID MAY BE
CORRECTED TO $48,122.52 AND CONSIDERED FOR AWARD ON THAT BASIS.
ACCORDINGLY, YOUR PROTEST MUST BE DENIED.
B-171627, MAY 11, 1971
BID PROTEST - NEGOTIATED CONTRACT
DECISION DENYING PROTEST AGAINST AWARD OF A NEGOTIATED CONTRACT TO
TEKTRONIX, INC., UNDER AN RFP ISSUED BY THE COAST GUARD FOR EIGHT TYPE
422 TEKTRONIX OSCILLOSCOPES.
SINCE THE COAST GUARD COMMANDANT ISSUED A DETERMINATION AND FINDINGS
JUSTIFYING THE NEGOTIATION OF A CONTRACT UNDER 10 U.S.C. 2304(A)(13) TO
ASSURE STANDARDIZATION OF EQUIPMENT AND INTERCHANGEABILITY OF PARTS,
THAT DETERMINATION IS FINAL AS A MATTER OF LAW UNDER 10 U.S.C. 2310(B).
FURTHER, SUCH AN RFP IS INCONSISTENT WITH THE PROCEDURES DESIGNATED FOR
A "BRAND NAME OR EQUAL" PROCUREMENT AND THERE IS NO VALID BASIS FOR AN
OBJECTION TO THE AWARD.
TO B & F INSTRUMENTS, INC.
REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 28, 1970, PROTESTING THE
AWARD OF A CONTRACT TO TEKTRONIX, INC., UNDER REQUEST FOR PROPOSALS
(RFP) CG-11,467-A, ISSUED BY THE UNITED STATES COAST GUARD.
PRIOR TO THE ISSUANCE OF THE RFP, THE COAST GUARD COMMANDANT ISSUED A
DETERMINATION AND FINDINGS (D&F) JUSTIFYING THE NEGOTIATION OF A
CONTRACT UNDER 10 U.S.C. 2304(A)(13) FOR THE PURCHASE OF EIGHT TYPE 422
TEKTRONIX OSCILLOSCOPES IN ORDER TO ASSURE STANDARDIZATION OF EQUIPMENT
AND INTERCHANGEABILITY OF PARTS WITHIN THE EXISTING LORAN-C TRANSMITTING
AND MONITORING STATIONS. UNDER 10 U.S.C. 2310(B), THAT DETERMINATION IS
FINAL AS A MATTER OF LAW.
THE RFP, ISSUED OCTOBER 22, 1970, SOLICITED OFFERS ON EQUIPMENT
DESCRIBED SIMPLY AS "OSCILLOSCOPE, TEKTRONIX TYPE 422." THERE WERE NO
SPECIFICATIONS, TECHNICAL INFORMATION, OR LIST OF SALIENT
CHARACTERISTICS INCLUDED IN THE RFP. NEITHER DID THE RFP PROVIDE FOR
THE CONSIDERATION OF "EQUAL" ITEMS. IT IS REPORTED THAT THE PROCUREMENT
WAS SYNOPSIZED IN THE COMMERCE BUSINESS DAILY TO TAKE ADVANTAGE OF
COMPETITION AMONG THE MANUFACTURER AND ITS DEALERS. AS A RESULT OF THE
SYNOPSIZING OF THE PROCUREMENT, PROPOSALS WERE RECEIVED FROM TEKTRONICS,
YOUR FIRM, AND MATSUSHITA ELECTRIC CORPORATION OF AMERICA.
YOUR PROPOSAL WAS THE LOWEST RECEIVED AND MATSUSHITA WAS THE SECOND
LOWEST OFFEROR. HOWEVER, THE CONTRACTING OFFICER REJECTED BOTH LOW
PROPOSALS AS THEY OFFERED BRAND NAME ITEMS OTHER THAN TEKTRONIX TYPE 422
OSCILLOSCOPES. AWARD WAS MADE TO TEKTRONIX FOR THE TYPE 422
OSCILLOSCOPES.
YOU CONTEND THAT THE RFP SHOULD BE CONSIDERED AS AUTHORIZING THE
TENDER OF AN ITEM "EQUAL" TO THE REQUESTED TYPE 422 TEKTRONIX
OSCILLOSCOPES. YOU CLAIM THAT "THE USE OF THE WORD TYPE RATHER THAN
MODEL IMPLIES THAT THE NUMBER IS INDICATING A CLASS OF INSTRUMENT RATHER
THAN A SPECIFIC UNIT." YOU ALSO CONTEND THAT IF EQUAL ITEMS FROM OTHER
MANUFACTURERS ARE NOT ACCEPTABLE THEN ALL COMPETITION HAS BEEN EXCLUDED.
WE DO NOT AGREE THAT THE RFP MAY BE REGARDED AS PROVIDING FOR A BRAND
NAME "OR EQUAL" PROCUREMENT. THE RFP WAS LIMITED TO TEKTRONIX TYPE 422
OSCILLOSCOPES. OUR OFFICE HAS BEEN ADVISED THAT THE TEKTRONIX BROCHURE
DESCRIBING THE OSCILLOSCOPES CLEARLY IDENTIFIES THE UNITS BY "TYPE,"
I.E., TYPE 422, RATHER THAN BY "MODEL" AND THAT TEKTRONIX USES THE WORD
"TYPE" AS SYNONYMOUS WITH THE WORD "MODEL." FURTHER, IT SHOULD BE NOTED
THAT SECTION 1-1.307-4 OF THE FEDERAL PROCUREMENT REGULATIONS PROVIDES
THE MANNER IN WHICH BRAND NAME OR EQUAL PROCUREMENTS ARE TO BE DESCRIBED
AND THAT SUCH PROCEDURE WAS NOT FOLLOWED IN THE IMMEDIATE RFP. IN ANY
EVENT, IN VIEW OF THE AFOREMENTIONED D&F, IT IS CLEAR TO US THAT AN "OR
EQUAL" PROCUREMENT WAS NOT INTENDED.
FURTHER, OUR OFFICE HAS HELD THAT THE FACT IT WAS FOUND NECESSARY FOR
AN AGENCY TO LIMIT A PROCUREMENT TO ONE MANUFACTURER IN ORDER TO ACHIEVE
STANDARDIZATION OF EQUIPMENT AND INTERCHANGEABILITY OF PARTS DOES NOT
AFFORD A VALID BASIS TO OBJECT TO THE PROCUREMENT. B-163382, MARCH 21,
1968.
IN THE CIRCUMSTANCES, THE PROTEST IS DENIED.
B-171653, MAY 11, 1971
BID PROTEST - SOLE SOURCE PROCUREMENT - PUBLIC EXIGENCY EXCEPTION
CONCERNING ALLEGATIONS OF IMPROPRIETY AND ILLEGALITY IN A PROCUREMENT
OF VEGETABLE SEEDS FROM THE DESSERT SEED COMPANY, INC., BY THE AGENCY
FOR INTERNATIONAL DEVELOPMENT.
A CONTRACT NEGOTIATED ORALLY ON A SOLE-SOURCE BASIS TO PROCURE
VEGETABLE SEEDS FOR SHIPMENT TO EAST PAKISTAN FOLLOWING A CYCLONE-FLOOD
IS NOT SUBJECT TO QUESTION BY THE COMP. GEN. BECAUSE IT WAS NEGOTIATED
UNDER THE AUTHORITY OF THE PUBLIC EXIGENCY EXCEPTION IN SECTION 1-3.203
OF THE FPR WHERE THE TIME LIMIT FOR DELIVERY COULD BE MET BY ONLY ONE
FIRM.
TO FERRY-MORSE SEED COMPANY, INC.
REFERENCE IS MADE TO YOUR LETTER DATED DECEMBER 11, 1970, FORWARDED
TO OUR OFFICE BY CONGRESSMAN CHARLES S. GUBSER ON JANUARY 5, 1971,
CONCERNING ALLEGATIONS OF IMPROPRIETY AND ILLEGALITY IN A PROCUREMENT OF
VEGETABLE SEEDS FROM THE DESSERT SEED COMPANY, INC., BY THE AGENCY FOR
INTERNATIONAL DEVELOPMENT (AID).
THE PROCUREMENT COVERED DISASTER RELIEF TO THE GOVERNMENT OF EAST
PAKISTAN FOLLOWING THE NOVEMBER 12-13, 1970, CYCLONE-FLOOD WHICH CAUSED
GREAT DAMAGE TO AGRICULTURAL CROPS. INITIALLY, DONATIONS OF VEGETABLE
SEEDS WERE SOUGHT BY EAST PAKISTAN THROUGH THE UNITED NATIONS FOOD AND
AGRICULTURE ORGANIZATION (UNFAO), FROM ALL COUNTRIES PROVIDING DISASTER
RELIEF, FOR SHIPMENT TO THE AFFECTED AREAS IN LATE DECEMBER 1970 AND
PLANTING IN EARLY JANUARY 1971. HOWEVER, WHEN IT BECAME EVIDENT THAT
UNFAO WOULD NOT BE ABLE TO SUPPLY THE NEEDED VEGETABLE SEEDS WITHIN THE
REQUIRED TIME LIMIT, AID CONTRACTING OFFICIALS, ON DECEMBER 3, 1970, AT
THE REQUEST OF THE AID DISASTER RELIEF DIVISION, COMMENCED "EMERGENCY
PROCUREMENT ACTION" TO PROCURE SPECIFIC QUANTITIES OF VARIOUS VEGETABLE
SEEDS.
IN VIEW OF THE IMPENDING DECEMBER DELIVERY DATE, CONCOMITANT WITH TH
PROCUREMENT ACTION, ARRANGEMENTS WERE MADE WITH THE MILITARY AIR COMMAND
BY THE AID DISASTER RELIEF COORDINATOR FOR THE SEEDS TO BE AIRLIFTED TO
EAST PAKISTAN ON OR ABOUT DECEMBER 12, 1970.
ON DECEMBER 3, 1970, THREE AID EMPLOYEES WERE ASSIGNED TO TELEPHONE
SEED COMPANIES TO DETERMINE WHETHER THEY WOULD BE ABLE TO FURNISH THE
VARIETIES OF SEED WITHIN THE DESIRED QUALITY, QUANTITY, PACKAGING AND
DELIVERY REQUIREMENTS. ELEVEN FIRMS, INCLUDING FERRY-MORSE, WERE
CONTACTED BY TELEPHONE. NONE OF THE INITIAL CONTACTS INCLUDED PRICE
DISCUSSIONS, SINCE ACTUAL PRICE NEGOTIATIONS WERE TO BE CONDUCTED WITH
THOSE FIRMS DETERMINED TO HAVE THE ABILITY TO COMPLY WITH AID
REQUIREMENTS. IT IS REPORTED THAT:
"BY MID-AFTERNOON ON FRIDAY, DECEMBER 4, THE RESULTS OF THE TELEPHONE
CALLS TO THE SEED COMPANIES WERE POOLED AND IT DEVELOPED THAT ONLY ONE
COMPANY, DESSERT SEED COMPANY, WAS CAPABLE OF MEETING ALL OF THE
REQUIREMENTS. GIVEN THE VERY SHORT TIME IN WHICH THE SUBSTANTIAL
QUANTITY OF SEED HAD TO BE SORTED, PACKAGED AND DELIVERED, DECISION WAS
MADE TO MAKE AWARD TO DESSERT SEED COMPANY, AND THAT COMPANY WAS SO
NOTIFIED IN THE LATE AFTERNOON OF FRIDAY, DECEMBER 4. THE SEED WAS
SORTED, PACKAGED AND DELIVERED TO THE MILITARY AIR COMMAND AT NORTON AIR
BASE, SAN BERNARDINO, CALIFORNIA, ON DECEMBER 12, 1970. IT ARRIVED IN
DACCA, EAST PAKISTAN AT 6 A.M., DECEMBER 15." A FORMAL CONTRACT WAS
ISSUED TO DESSERT ON DECEMBER 28, 1970.
YOU HAVE ALLEGED THAT THERE WAS IMPROPRIETY OR ILLEGALITY IN THE
CONDUCT OF THIS PROCUREMENT BECAUSE THE CONTRACT WAS NEGOTIATED ORALLY
ON A SOLE-SOURCE BASIS "WITHOUT BOTH A WRITTEN REQUEST FOR AND A WRITTEN
BID, AS GOVERNMENT REGULATIONS SPECIFY." HOWEVER, THE CONDUCT OF THIS
PROCUREMENT ON AN ORAL AND SOLE-SOURCE BASIS IS NOT SUBJECT TO QUESTION
BY OUR OFFICE FOR THE REASONS INDICATED BELOW.
THE CONTRACT WAS NEGOTIATED ORALLY ON A SOLE-SOURCE BASIS UNDER THE
AUTHORITY OF SECTION 633 OF THE FOREIGN ASSISTANCE ACT OF 1961, AS
AMENDED, AND EXECUTIVE ORDER NO. 11223, MAY 12, 1965, AS IMPLEMENTED BY
THE PROVISIONS OF AID PROCUREMENT REGULATIONS (AIDPR) 7-3.200-50. THAT
REGULATION PERMITS AN AID CONTRACT TO BE NEGOTIATED UNDER THE AUTHORITY
OF THE PUBLIC EXIGENCY EXCEPTION IN SECTION 1-3.202 OF THE FEDERAL
PROCUREMENT REGULATIONS (FPR).
FPR SEC. 1-3.202(A) PRESCRIBES THAT, IN ORDER FOR THE PUBLIC EXIGENCY
AUTHORITY TO BE USED, THE NEED MUST BE COMPELLING AND OF UNUSUAL
URGENCY. PROPERTY "NEEDED AT ONCE BECAUSE OF A FIRE, FLOOD, EXPLOSION,
OR OTHER DISASTER" IS CITED AS AN EXAMPLE OF PUBLIC EXIGENCY.
SUBPARAGRAPH (B)(1) OF THE REGULATION REQUIRES THAT EVERY CONTRACT
NEGOTIATED UNDER THE AUTHORITY BE SUPPORTED BY A DETERMINATION AND
FINDINGS JUSTIFYING USE OF THE AUTHORITY. SUBPARAGRAPH (B)(2) PROVIDES:
"(2) WHEN PURCHASE ACTION UNDER THIS AUTHORITY IS BASED ON TELEPHONE
OR OTHER ORAL OFFERS, A WRITTEN CONFIRMATION OF THE ACCEPTED OFFER SHALL
BE OBTAINED AND MADE A PART OF THE PURCHASE CASE FILE. IN ADDITION, A
RECORD SHALL BE ESTABLISHED IN SUCH CASES WHICH SHALL CONTAIN, AS A
MINIMUM, THE FOLLOWING INFORMATION WITH RESPECT TO EACH OFFER: NAME AND
ADDRESS OF EACH OFFEROR QUOTING, DESCRIPTION OF ITEM, UNIT PRICE,
DELIVERY TIME, AND DISCOUNT TERMS OFFERED. IF QUOTATIONS LOWER THAN THE
ACCEPTED QUOTATION ARE RECEIVED, THE REASONS FOR THEIR REJECTION SHALL
BE RECORDED AND MADE A PART OF THE PURCHASE FILE." ALSO, FPR SEC.
1-3.802(C) STATES, IN PART, AS FOLLOWS:
" *** GENERALLY, REQUESTS FOR PROPOSALS SHALL BE IN WRITING.
HOWEVER, IN APPROPRIATE CASES, SUCH AS THE PROCUREMENT OF PERISHABLE
SUBSISTENCE, ORAL REQUESTS FOR QUOTATIONS ARE AUTHORIZED."
FPR SEC. 1-3.202 WAS CITED AS NEGOTIATION AUTHORITY FOR THIS
PROCUREMENT IN THE DETERMINATION AND FINDINGS. IN SUPPORT OF
NEGOTIATION ON A SOLE-SOURCE BASIS WITH DESSERT, IT WAS STATED:
"TYPE OF PROCUREMENT:
"EMERGENCY NEGOTIATED PROCUREMENT - TELEPHONIC QUOTATIONS TO
RESPONSIBLE SEED COMPANIES ON CAPABILITY TO DELIVER, UNDER REQUIRED
SPECIFICATIONS, AND EMERGENCY DELIVERY SCHEDULES, VEGETABLE SEEDS.
"3. DETERMINATIONS/JUSTIFICATION
"A. BY LATE FRIDAY AFTERNOON (12/4) IT WAS CLEAR THAT THERE WAS ONLY
ONE RESPONSIBLE SUPPLIER WHO COULD FULLY COMPLY WITH ALL REQUIREMENTS.
"B. THE AIR FORCE WAS READYING THREE C-141'S FOR DEPARTURE TO DACCA
TO RETRIEVE AND RETURN TO THE U.S. THE HELICOPTERS SENT FOR EMERGENCY
USE IN THE DISASTER AREA, AND WERE SCHEDULED TO DEPART U.S. DECEMBER
11TH AND 12TH. IT WAS IMPORTANT TO TAKE ADVANTAGE OF THESE AIRCRAFT AND
SAVINGS TO THE GOVERNMENT OF COMMERCIAL AIR FREIGHT COSTS, AND MEETING
DELIVERY WITHIN THE EMERGENCY.
"4. FINDINGS AND FACTS
"A. THIS PROCUREMENT IS FOR EMERGENCY REQUIREMENTS OF VICTIMS OF THE
FLOOD DISASTER FOR ARRIVAL DACCA EARLY DECEMBER FOR PLANTING.
"B. DEMAND DELIVERY SCHEDULE FROM SUPPLIER DECEMBER 9 - 10 FOR
MILITARY AIRCRAFT PICKUP BY 1 OR MORE C-141'S DESTINED TO DEPART U.S. TO
RETRIEVE HELICOPTERS PREVIOUSLY COMMITTED."
IN VIEW OF THE ABOVE-CITED REGULATIONS AND THE DETERMINATION AND
FINDINGS, WE FIND NO LEGAL BASIS TO OBJECT TO THE DECISION TO OBTAIN AN
ORAL QUOTATION FROM DESSERT. FURTHER, THE ORAL ACCEPTANCE OF THE
DESSERT OFFER BY AID ON DECEMBER 4, 1970, CONSUMMATED A VALID AND
BINDING CONTRACT. B-164887, DECEMBER 2, 1968.
CONCERNING THE SOLE-SOURCE NATURE OF THE PROCUREMENT, WE NOTE THAT
YOUR LETTER INDICATES A MISTAKEN IMPRESSION THAT THE AID REQUIREMENTS
FOR THE VEGETABLE SEEDS DICTATED AN EARLY JANUARY DELIVERY DATE. AS
STATED, SUPRA, DELIVERY OF THE VEGETABLE SEEDS WAS REQUIRED BY DECEMBER
12 FOR PLANTING, NOT DELIVERY, IN EARLY JANUARY. WHILE YOUR LETTER
CONCLUDES THAT THREE SEED COMPANIES, INCLUDING FERRY-MORSE, COULD HAVE
MET AID DELIVERY REQUIREMENTS, NOTING THAT FERRY-MORSE WAS PREPARED TO
PACKAGE THE ORDER IN 1 DAY AT ITS KENTUCKY PLANT, THE RECORD DOES NOT
SUPPORT YOUR CONCLUSION. IN THIS REGARD, AN AID MEMORANDUM BASED ON A
TELEPHONIC DISCUSSION WITH FERRY-MORSE STATES:
"FERRY-MORSE CAN SUPPLY SEEDS BUT PACKAGING THE PROBLEM. PACKAGING
WOULD BE DONE IN KENTUCKY AND THE SEEDS ARE IN CALIFORNIA. HE DIDN'T
KNOW WHAT TYPE OF PACKAGING COULD BE SUPPLIED.
" *** DELIVERY TIME ELEMENT WAS A FACTOR AND THEY COULD NOT DISRUPT
DOMESTIC MARKETING FOR A ONE TIME JOB." IN VIEW THEREOF, WE CANNOT
CONCLUDE THAT AID IMPROPERLY EXCLUDED FERRY-MORSE FROM FURTHER
CONSIDERATION. AS FOR THE OTHER 10 SEED FIRMS CONTACTED, ALL, EXCEPT
DESSERT, INDICATED EITHER NONINTEREST IN THE PROCUREMENT OR INABILITY TO
COMPLY WITH THE URGENT DELIVERY SCHEDULE.
THE INFORMATION AVAILABLE TO AID ON DECEMBER 4 THAT ONLY DESSERT
COULD MEET THE AGENCY NEEDS WITHIN THE REQUIRED TIME LIMIT SUFFICIENTLY
SUPPORTS THE CONTRACTING OFFICER'S DECISION TO LIMIT NEGOTIATIONS TO
DESSERT. WE ARE THEREFORE UNABLE TO CONCLUDE, AS YOU CONTEND, THAT THE
CONTRACTING OFFICER ACTED ARBITRARILY IN THE CIRCUMSTANCES.
B-171791, MAY 11, 1971
CONTRACTS - CLAIM FOR ADDITIONAL PAYMENTS
DECISION DENYING CLAIM FOR ADDITIONAL PAYMENT OF $250.80 SUBMITTED BY
LEONARD LYMAN INCIDENT TO THREE FIRE EQUIPMENT RENTAL CONTRACTS.
PAYMENTS MADE ON ALL THREE AGREEMENTS WERE BASED ON THE MINIMUM DAILY
GUARANTEE AND THIS INCLUDED THE DAILY AMOUNT DUE FOR MILEAGE. ALTHOUGH
THE CONTRACTING OFFICER STATES THAT HE DID NOT SPEND SUFFICIENT TIME
DISCUSSING THE TERMS OF THE NEW AGREEMENT FORM WITH CLAIMANT, IN THE
ABSENCE OF FRAUD OR WILLFUL DECEIT, CLAIMANT CANNOT BE HEARD TO COMPLAIN
THAT HE DID NOT READ THE CONTRACT AND IS NOT, CONSEQUENTLY, BOUND BY ITS
TERMS. THE CLAIM FOR ADDITIONAL PAYMENTS MUST BE DENIED.
TO MR. KELLNER:
REFERENCE IS MADE TO YOUR LETTER 6540 OF JANUARY 14, 1971, CONCERNING
THE CLAIM OF MR. LEONARD LYMAN FOR $250.80 ARISING UNDER THREE FIRE
EQUIPMENT RENTAL CONTRACTS, AGREEMENTS 26-11-70 AND 26-9-70 DATED AUGUST
27, 1970, AND AN UNNUMBERED AGREEMENT DATED SEPTEMBER 3, 1970, WHICH THE
CLAIMANT EXECUTED WITH THE FOREST SERVICE FOR THE USE OF EQUIPMENT ON
THE CROSS CREEK FIRE AT THE LEWIS & CLARK NATIONAL FOREST.
THE DAILY PAYMENT DUE MR. LYMAN UNDER THE THREE AGREEMENTS WAS
DETERMINED BY COMBINING THE DAILY RATE COMPUTED TO THE NEAREST QUARTER
DAY WORKED AND THE DAILY AMOUNT DUE FOR MILEAGE. HOWEVER, AS IN ALL
THREE CASES THE MINIMUM DAILY PAYMENT GUARANTEE PROVIDED FOR IN CLAUSE
8(D) OF THE AGREEMENTS EXCEEDED THE AMOUNT DUE AS COMPUTED, PAYMENT WAS
MADE IN THE AMOUNT OF THE MINIMUM DAILY GUARANTEE. MR. LYMAN CONTENDS
IN HIS LETTER OF OCTOBER 3, 1970, THAT HE WAS OF THE UNDERSTANDING THAT
HE WAS TO RECEIVE THE DAILY RATE PLUS THE DAILY AMOUNT DUE FOR MILEAGE.
THUS, SINCE THE PAYMENT TO MR. LYMAN WAS BASED ON THE MINIMUM DAILY
PAYMENT GUARANTEE, WHICH IS EQUAL TO THE DAILY RATE, HE IS CLAIMING IN
ADDITON THE DAILY AMOUNTS ALLEGEDLY DUE FOR MILEAGE.
AS NOTED BY YOU, IN THE PAST THE RENTAL OF FIRE EQUIPMENT WAS PAID
FOR ON A 24-HOUR PER DAY DAILY RATE, PLUS A MILEAGE RATE, WITH NO
PROVISION FOR COMPUTING PAYMENT DUE ON A QUARTER DAY BASIS EXCEPT FOR
THE FIRST AND LAST DAYS. THIS METHOD OF PAYMENT, WHICH CORRESPONDS TO
THE METHOD UNDER WHICH MR. LYMAN CONTENDS HE SHOULD HAVE BEEN PAID, WAS
USED DURING THE PAST 10 YEARS. HOWEVER, A NEW FIRE EQUIPMENT RENTAL
AGREEMENT, FORM 6300-23, WAS PUT INTO EFFECT ON A FOREST SERVICE-WIDE
BASIS IN FEBRUARY 1970 AND THIS FORM WAS RECEIVED BY YOUR REGION IN
APRIL 1970. IT WAS ON THIS NEW FORM THAT THE AGREEMENTS WITH MR. LYMAN
WERE EXECUTED. THE CONTRACTING OFFICER STATES THAT BECAUSE OF THE
EMERGENCY SITUATION EXISTING AT THE TIME OF THE EXECUTION OF THE
AGREEMENTS, HE DID NOT SPEND SUFFICIENT TIME DISCUSSING THE TERMS
INCORPORATED IN THE NEW FORM WITH MR. LYMAN. HE ASSUMED THAT THE
CLAIMANT HAD READ AND UNDERSTOOD THE CHANGES MADE REGARDING PAYMENT FOR
RENTALS, ALTHOUGH NOW IT APPEARS THAT THE CLAIMANT EITHER WAS NOT AWARE
OF OR DID NOT UNDERSTAND THE NATURE OF THESE CHANGES. YOU QUESTION
WHETHER THE FAILURE OF THE CONTRACTING OFFICER TO EXPLAIN THE CHANGES IS
ENOUGH TO INVALIDATE THE CONTRACT AND ALLOW PAYMENT OF MR. LYMAN'S
CLAIM.
THE ESTABLISHED RULE IS THAT IN THE ABSENCE OF FRAUD OR WILLFUL
DECEIT, ONE WHO SIGNS A CONTRACT WHICH HE HAS HAD AN OPPORTUNITY TO READ
AND UNDERSTAND IS BOUND BY THE TERMS OF THE CONTRACT, AND SUCH PERSON
CANNOT BE HEARD TO COMPLAIN THAT HE DID NOT READ THE CONTRACT AND IS
NOT, CONSEQUENTLY, BOUND BY ITS TERMS. ALLIED STEEL AND CONVEYORS, INC.
V FORD MOTOR COMPANY, 277 F. 2D 907, 913-914 (1960).
CONSEQUENTLY, THE CLAIM OF MR. LYMAN FOR ADDITIONAL PAYMENT MUST BE
DENIED.
B-171851, MAY 11, 1971
BID PROTEST - DAVIS BACON ACT
DECISION DENYING PROTEST AGAINST REJECTION OF ALL BIDS AND
CANCELLATION OF AN IFB ISSUED BY THE JOB CORPS, DEPARTMENT OF LABOR
INCIDENT TO THE SUSPENSION OF THE DAVIS BACON ACT PROVISIONS.
THE SUSPENSION OF THE PROVISIONS OF THE DAVIS-BACON ACT BY
PRESIDENTIAL PROCLAMATION CONSTITUTES JUSTIFICATION FOR REJECTION OF ALL
BIDS BASED ON ADHERENCE TO THE PREVAILING WAGE RATE REQUIREMENTS WHICH
HAD BEEN OPENED. FURTHER A NEW SOLICITATION WAS ISSUED FOR THE INSTANT
PROCUREMENT ON MARCH 29, 1971, OMITTING THE DAVIS-BACON ACT PROVISIONS
AND AN AWARD MAY BE MADE THEREUNDER, NOTWITHSTANDING THE REINSTATEMENT
OF THE PROVISIONS.
TO MCNEANY, ROSE AND SHOLER
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 9, 1971, WITH ENCLOSURE,
SUPPLEMENTING THE PROTEST OF THE JACK B. HENDERSON CONSTRUCTION COMPANY,
INCORPORATED, CONCERNING AN AWARD OF CONTRACT UNDER INVITATION FOR BIDS
NO. 71-100, ISSUED BY THE JOB CORPS, UNITED STATES DEPARTMENT OF LABOR.
WE HAVE BEEN ADVISED BY THE PROCURING ACTIVITY THAT THE INVITATION
HAS BEEN CANCELED ON THE BASIS OF PRESIDENTIAL PROCLAMATION 4031, DATED
FEBRUARY 23, 1971, 36 FEDERAL REGISTER 3457-8, IN WHICH THE PRESIDENT
SUSPENDED THE PROVISIONS OF THE DAVIS-BACON ACT AS TO ALL CONTRACTS
ENTERED INTO ON OR SUBSEQUENT TO THE DATE OF THE PROCLAMATION, WHICH, IN
PERTINENT PART, STATES:
"SECTION 6 OF THE DAVIS-BACON ACT PROVIDES:
"'IN THE EVENT OF A NATIONAL EMERGENCY THE PRESIDENT IS AUTHORIZED TO
SUSPEND THE PROVISIONS OF THIS ACT.'
"WHEREAS I FIND THAT A NATIONAL EMERGENCY EXISTS WITHIN THE MEANING
OF SECTION 6 OF THE DAVIS-BACON ACT OF MARCH 3, 1931 (46 STAT. 1494, AS
AMENDED, 40 U.S.C. 276A).
"NOW, THEREFORE, I, RICHARD NIXON, PRESIDENT OF THE UNITED STATES OF
AMERICA, DO BY THIS PROCLAMATION SUSPEND, AS TO ALL CONTRACTS ENTERED
INTO ON OR SUBSEQUENT TO THE DATE OF THIS PROCLAMATION AND UNTIL
OTHERWISE PROVIDED, THE PROVISIONS OF THE DAVIS-BACON ACT OF MARCH 3,
1931, AS AMENDED, AND THE PROVISIONS OF ALL OTHER ACTS PROVIDING FOR THE
PAYMENT OF WAGES, WHICH PROVISIONS ARE DEPENDENT UPON DETERMINATIONS BY
THE SECRETARY OF LABOR UNDER THE DAVIS-BACON ACT;
"AND I DO HEREBY SUSPEND UNTIL OTHERWISE PROVIDED THE PROVISIONS OF
ANY EXECUTIVE ORDER, PROCLAMATION, RULE, REGULATION OR OTHER DIRECTIVE
PROVIDING FOR THE PAYMENT OF WAGES, WHICH PROVISIONS ARE DEPENDENT UPON
DETERMINATIONS BY THE SECRETARY OF LABOR UNDER THE DAVIS-BACON ACT;"
ON FEBRUARY 25, 1971, THE ADMINISTRATOR, WORKPLACE STANDARDS
ADMINISTRATION, DEPARTMENT OF LABOR, IN IMPLEMENTATION OF THE
PROCLAMATION, INDICATED THAT WHERE BIDS BASED ON ADHERENCE TO THE
PREVAILING WAGE RATE REQUIREMENTS HAD ALREADY BEEN OPENED, THE PURPOSE
OF THE ORDER COULD BE ACCOMPLISHED BY A READVERTISING FOR BIDS.
INVITATION FOR BIDS NO. 71-100 WAS ACCORDINGLY CANCELED AND WE ARE
INFORMALLY ADVISED THAT A NEW SOLICITATION WAS ISSUED FOR THE
PROCUREMENT ON MARCH 29, 1971, OMITTING THE DAVIS-BACON ACT PROVISIONS.
IT IS OUR VIEW THAT SUSPENSION OF THE PROVISIONS OF THE DAVIS-BACON
ACT BY THE PRESIDENT CONSTITUTES JUSTIFICATION FOR THE REJECTION OF ALL
BIDS UNDER THE ORIGINAL INVITATION. IN LIGHT OF THAT CONCLUSION, WE DO
NOT FIND IT NECESSARY TO DECIDE WHAT THE PROPER DISPOSITION OF THE BIDS
WOULD HAVE BEEN BUT FOR CANCELLATION OF THE SOLICITATION BECAUSE OF THE
PRESIDENT'S ACTION. THE DAVIS-BACON ACT PROVISIONS HAVE SINCE BEEN
RESTORED BY PRESIDENTIAL PROCLAMATION WITH RESPECT TO SOLICITATIONS
ISSUED AFTER MARCH 29, 1971. HOWEVER, AS TO SOLICITATIONS ISSUED ON OR
BEFORE THAT DATE, CONTRACTS MAY BE AWARDED WITHOUT THE DAVIS-BACON ACT
PROVISIONS.
B-172486, MAY 11, 1971
BID PROTEST - BID RESPONSIVENESS - AMENDMENTS
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST AWARD OF
CONTRACT TO PACIFIC VENTURES, INC., LOW BIDDER, UNDER AN IFB ISSUED BY
THE ARMY ENGINEERING DISTRICT, ANCHORAGE, ALASKA, FOR THE CONSTRUCTION
OF AN UNDERGROUND POWERHOUSE.
ALTHOUGH SUCCESSFUL LOW BIDDER DID NOT SUBSTITUTE THE NEW AND REVISED
PAGES CONTAINED IN AN AMENDMENT, BUT INSTEAD MODIFIED THE SUPERSEDED BID
SCHEDULE, SINCE THE AMENDMENT WAS SPECIFICALLY REFERRED TO IN THE BID,
THE COMP. GEN. CONCLUDES THAT THE BIDDER INTENDED TO BE BOUND BY THE
TERMS OF THE OPTION CONTAINED THEREIN. FURTHER CHANGES AND ERASURES OF
PRICES WERE MADE IN THE EXTENSION PRICE AND NONE OF THE UNIT PRICES WERE
SO ALTERED; THE FAILURE TO INITIAL THE CHANGES WAS THEREFORE PROPERLY
WAIVED PURSUANT TO ASPR 2-405. ACCORDINGLY THE PROTEST IS DENIED.
TO SELLERS, CONNER AND CUNEO:
BY TELEFAXES DATED MARCH 30 AND APRIL 7, 1971, AND LETTER DATED APRIL
16, 1971, YOU PROTEST ON BEHALF OF AMELCO CORPORATION (AMELCO), AGAINST
ANY AWARD TO PACIFIC VENTURES, INCORPORATED (PACIFIC), UNDER INVITATION
FOR BIDS (IFB) NO. DACW 85-71-B-0019 ISSUED ON MARCH 3, 1971, BY THE
UNITED STATES ARMY ENGINEER DISTRICT, AT ANCHORAGE, ALASKA, FOR THE
CONSTRUCTION OF AN UNDERGROUND POWERHOUSE AND INSTALLATION OF EQUIPMENT
IN AN UNDERGROUND CHAMBER EXCAVATED BY OTHERS AT SNETTISHAM, ALASKA.
THE SUBJECT PROCUREMENT WAS INITIALLY SOLICITED UNDER INVITATION FOR
BIDS (IFB) NO. DACW 85-71-B-0005 ISSUED ON OCTOBER 19, 1970; HOWEVER,
AS A RESULT OF THE PRESIDENTIAL PROCLAMATION REMOVING THE APPLICATION OF
THE DAVIS-BACON ACT BIDS WERE REJECTED UNDER THE IFB OF OCTOBER 19 AND
THE WORK READVERTISED UNDER THE IFB OF MARCH 3, OMITTING THE DAVIS-BACON
ACT REQUIREMENTS BUT UTILIZING THE SAME PLANS AND SPECIFICATIONS.
AMENDMENT R-2 TO THE SUBJECT IFB WAS ISSUED MARCH 17, 1971, MAKING
REVISIONS TO THE GENERAL PROVISIONS, SPECIAL PROVISIONS AND TECHNICAL
PROVISIONS, AND REVISING THE BID SCHEDULE AS FOLLOWS:
A. ON PAGE BS-1, ITEM 13 WAS DELETED;
B. ON PAGE BS-2, ITEM 27, THE ESTIMATED QUANTITIES WERE CHANGED FROM
500 TO 535;
C. ON PAGE BS-8, ITEM 130, INSTALL POWERLINE CARRIER EQUIPMENT, WAS
ADDED AS A BASIC BID ITEM. ALSO ON PAGE BS-8, OPTIONAL ITEM 1A, METAL
ARCH CEILING, WAS ADDED.
D. ON PAGE BS-9 (A SUPPLEMENTAL SHEET TO STANDARD FORM 22,
INSTRUCTIONS TO BIDDERS) WAS REVISED TO ADD PARAGRAPH 6 WHICH READS:
"EVALUATION OF BIDS: BIDS WILL BE EVALUATED FOR THE PURPOSE OF AWARD BY
ADDING THE PRICE FOR OPTION ITEM 1A TO THE TOTAL PRICE FOR THE BASIC BID
ITEMS. EVALUATION OF THE OPTION WILL NOT OBLIGATE THE GOVERNMENT TO
EXERCISE THE OPTION. ANY BID WHICH IS MATERIALLY UNBALANCED AS TO
PRICES FOR BASIC AND OPTION QUANTITIES MAY BE REJECTED AS NONRESPONSIVE.
AN UNBALANCED BID IS ONE WHICH IS BASED ON PRICES SIGNIFICANTLY LESS
THAN COST FOR SOME WORK AND PRICES WHICH ARE SIGNIFICANTLY OVERSTATED
FOR OTHER WORK. THE GOVERNMENT RESERVES THE RIGHT TO EXERCISE THE AWARD
OF THE OPTION FOR 90 DAYS FOLLOWING DATE OF BASIC AWARD." BIDDERS WERE
INSTRUCTED TO SUBSTITUTE THE NEW AND REVISED PAGES FOR THE SUPERSEDED
PAGES.
BIDS WERE OPENED ON MARCH 25, 1971, AND PACIFIC'S BID OF
$3,762,152.25 WAS LOW WHILE AMELCO'S BID OF $3,797,000 WAS SECOND LOW.
THE PACIFIC BID CONTAINED AN ACKNOWLEDGEMENT OF AMENDMENT NO. R-2;
HOWEVER, THE LOW BIDDER DID NOT SUBSTITUTE THE REVISED PAGES OF THE
AMENDMENT BUT RATHER MODIFIED THE SUPERSEDED BID SCHEDULE PAGES TO
CONFORM TO THE BID SCHEDULE AS REVISED BY AMENDMENT R-2. A PRICE WAS
INSERTED FOR OPTION ITEM 1A BUT THE BID DID NOT INCLUDE PARAGRAPH 6 OF
THE REVISED BIDDING SCHEDULE WHICH EXPRESSES THE METHOD OF EVALUATION OF
BIDS AND RESERVES TO THE GOVERNMENT A 90-DAY OPTION TO AWARD THE
OPTIONAL ITEM.
YOU CONTEND THAT BECAUSE OF THE FAILURE OF THE PACIFIC BID TO INCLUDE
PARAGRAPH 6 OF THE REVISED BIDDING SCHEDULE, THE BID EVIDENCED AN
INTENTION BY THE BIDDER NOT TO BE BOUND BY THE TERMS OF PARAGRAPH 6, AND
THEREFORE THE BID IS NONRESPONSIVE. IT IS ALSO CONTENDED THAT THE LOW
BID IS NONRESPONSIVE BECAUSE ERASURES AND CHANGES WERE MADE IN ESTIMATES
CONTAINED IN THE BIDDING SCHEDULE WHICH WERE NOT INITIALED AS REQUIRED
BY STANDARD FORM 22.
WHETHER PACIFIC BY ITS BID INTENDED TO BE BOUND BY ALL THE TERMS AND
CONDITIONS OF THE SUBJECT IFB, NOTWITHSTANDING ITS FAILURE TO INCLUDE
THE REVISED OPTION PROVISION CONTAINED IN PARAGRAPH 6 WITH ITS BID, IS
TO BE DETERMINED FROM THE BID ITSELF. THE BASIC QUESTION INVOLVED IS
WHETHER ACCEPTANCE OF PACIFIC'S BID AS SUBMITTED WOULD CONSUMMATE A
VALID AND BINDING CONTRACT REQUIRING IT TO HONOR THE GOVERNMENT'S RIGHT
TO EXERCISE ITS OPTION.
IN 42 COMP. GEN. 502 (1963), WHICH YOU CITE, THIS OFFICE HELD THAT
SPECIAL PROVISIONS WHICH WERE ATTACHED TO THE INVITATION FOR BIDS WOULD
NOT BE BINDING UNLESS SUBMITTED WITH THE BID AND THE FAILURE TO RETURN
THE ATTACHMENTS WITH THE BID RENDERED THAT BID NONRESPONSIVE. THIS
HOLDING WAS BASED ON THE FACT THAT THE LANGUAGE OF THE EXECUTED BID FORM
BOUND THE BIDDER ONLY TO THOSE SCHEDULES AND PROVISIONS "ATTACHED" TO
THE BID WHEN SUBMITTED AND THE BID AS SUBMITTED DID NOT EXPRESS ANY
INTENTION TO BE BOUND BY THE OMITTED SPECIAL PROVISIONS.
SINCE AMENDMENT R-2 IS SPECIFICALLY REFERRED TO IN PACIFIC'S BID AND
PACIFIC INCLUDED AN ESTIMATE FOR THE OPTION ITEM, IT WOULD BE EXTREMELY
DIFFICULT FOR THIS OFFICE TO CONCLUDE THAT THE BIDDER DID NOT INTEND TO
BE BOUND BY THE TERMS OF THE OPTION. IT IS A RULE OF CONTRACT LAW THAT
WHERE A WRITING REFERS TO ANOTHER DOCUMENT, THAT OTHER DOCUMENT, OR SO
MUCH OF IT AS IS REFERRED TO, IS TO BE INTERPRETED AS A PART OF THE
WRITING. SEE 44 COMP. GEN. 774, 776 (1965), AND THE AUTHORITIES CITED
THEREIN. BASED ON THE FOREGOING, WE CONCLUDE THAT PARAGRAPH 6 WAS
INCORPORATED INTO AND MADE A PART OF THE BID OF PACIFIC.
IN REGARD TO AMELCO'S CONTENTION THAT PACIFIC'S BIDDING SCHEDULE
CONTAINS UNINITIALED CHANGES AND ERASURES IN CONTRAVENTION OF PARAGRAPH
5 OF STANDARD FORM 22 "INSTRUCTIONS TO BIDDERS," IT MUST BE NOTED THAT
ALL THE CHANGES MADE WERE IN THE EXTENSION PRICE AND NONE OF THE UNIT
PRICES WERE SO ALTERED. IN THIS CONNECTION, THE BIDDING SCHEDULE
PROVIDES THAT ALL EXTENSIONS OF UNIT PRICES ARE SUBJECT TO GOVERNMENT
VERIFICATION AND IN CASE OF VARIATION THE UNIT PRICE WILL BE CONSIDERED
TO BE THE BID. UNDER SUCH CIRCUMSTANCES, WE CONCLUDE THAT THERE IS NO
DOUBT AS TO THE INTENDED BID PRICES AND THAT THE FAILURE TO INITIAL THE
CHANGES IN THIS INSTANCE WAS A MINOR INFORMALITY WHICH WAS PROPERLY
WAIVED PURSUANT TO ASPR 2-405. SEE 49 COMP. GEN. 541 (1970).
AMELCO'S PROTEST MUST THEREFORE BE DENIED.
B-172596, MAY 11, 1971
BID PROTEST - MISTAKE IN BID
DECISION ALLOWING ADJUSTMENT TO A CONTRACT AWARDED TO BETCO
ELECTRONICS FOR FIRE ALARM UNITS, DUE TO A MISTAKE IN BID OF $1,022.77.
BECAUSE SUCCESSFUL BIDDER SUBMITTED A BID 34 PERCENT LOWER THAN THE
NEXT LOW BID, THE CONTRACTING OFFICER WAS ON CONSTRUCTIVE NOTICE OF A
POSSIBLE ERROR AND VERIFICATION SHOULD HAVE BEEN REQUESTED BEFORE AWARD.
THE PRICE OF THE CONTRACT MAY THEREFORE BE ADJUSTED TO PROVIDE FOR THE
INCREASE REQUESTED.
TO MR. POSTMASTER GENERAL:
REFERENCE IS MADE TO THE LETTER DATED APRIL 9, 1971, FROM THE
ASSISTANT GENERAL COUNSEL, REAL PROPERTY AND PROCUREMENT DIVISION,
CONCERNING A MISTAKE IN AN OFFER ALLEGED BY BETCO ELECTRONICS AFTER
AWARD ON NOVEMBER 10, 1970, OF CONTRACT 71-1-00489 FOR FIRE ALARM UNITS
BY THE BUREAU OF FACILITIES, OFFICE OF PROCUREMENT, PURSUANT TO REQUEST
FOR PROPOSAL NC-13-71.
BY LETTER OF NOVEMBER 17, 1970, BETCO ALLEGED AN ERROR ON THE BASIS
THAT IT OMITTED TWO ITEMS VALUED AT $1,022.77, NOT INCLUDING G&A AND
PROFIT, FROM THE COMPANY'S PROPOSAL. TO SUBSTANTIATE THE ERROR, WHICH
OCCURRED WHEN THE TWO ITEMS WERE INADVERTENTLY OMITTED FROM THE OFFER
PRICE WORKSHEET, THE CONTRACTOR ENCLOSED WITH THE LETTER ITS MATERIAL
COST SHEET AND OFFER PRICE WORKSHEET. THE TWO ITEMS ARE INCLUDED AND
PRICED ON THE MATERIAL COST SHEET.
IN THE APRIL 9 LETTER, IT IS STATED THAT THE CONTRACTING OFFICER WAS
ON CONSTRUCTIVE NOTICE OF POSSIBLE ERROR BECAUSE OF THE DIFFERENCE OF 34
PERCENT BETWEEN BETCO'S LOW PROPOSAL OF $4,930 AND THE NEXT LOW PROPOSAL
OF $7,500 AND HE SHOULD HAVE REQUESTED VERIFICATION OF THE PROPOSAL
SUBMITTED BY BETCO BEFORE AWARD. THE ONLY OTHER PROPOSAL SUBMITTED WAS
IN THE AMOUNT OF $14,174.
SECTION 1-3.104 OF THE FEDERAL PROCUREMENT REGULATIONS (FPR) PROVIDES
FOR THE DISPOSITION OF MISTAKES IN CONTRACTORS' PROPOSALS DISCOVERED
AFTER AWARD IN ACCORDANCE WITH THE MISTAKE IN BID LIMITATIONS AND
PROCEDURES IN FPR SEC. 1-2.406-4. FURTHER, OUR OFFICE HAS CONSIDERED A
REQUESTED INCREASE IN CONTRACT PRICE FOR MISTAKE ALLEGED AFTER AWARD OF
A NEGOTIATED CONTRACT IN ACCORDANCE WITH PRINCIPLES APPLYING TO ERRORS
IN BIDS. 48 COMP. GEN. 672 (1969). IN THE LATTER DECISION, IT WAS
STATED THAT A BIDDER WHO MAKES A MISTAKE IN BID WHICH HAS BEEN ACCEPTED
IN GOOD FAITH MUST BEAR THE CONSEQUENCES UNLESS THE MISTAKE WAS MUTUAL
OR THE CONTRACTING OFFICER HAD EITHER ACTUAL OR CONSTRUCTIVE NOTICE OF
MISTAKE PRIOR TO AWARD.
WE AGREE THAT THE CONTRACTING OFFICER IN THE IMMEDIATE CASE WAS ON
CONSTRUCTIVE NOTICE OF A POSSIBLE ERROR BECAUSE OF THE 34-PERCENT
DIFFERENCE BETWEEN THE TWO LOW OFFERS AND VERIFICATION SHOULD HAVE BEEN
REQUESTED OF BETCO BEFORE AWARD.
IN VIEW THEREOF, AND CONSIDERING THE EVIDENCE SUBMITTED, THE CONTRACT
PRICE SHOULD BE ADJUSTED TO PROVIDE FOR THE INCREASE REQUESTED.
A-51604, MAY 10, 1971
FOOD STAMP PROGRAM - RETURN OF CASH CHANGE
ADVISING THAT THERE IS NO LEGAL OBJECTION TO PERMITTING AUTHORIZED
FOOD STORES TO RETURN CASH CHANGE NOT EXCEEDING 49 CENTS TO AN ELIGIBLE
HOUSEHOLD IN A FOOD STAMP TRANSACTION.
SINCE THE SECRETARY OF AGRICULTURE DETERMINED THAT THE PROVISION FOR
PERMITTING THE ISSUANCE OF CASH FOR CHANGE OF LESS THAN 50 CENTS IS
NECESSARY AND APPROPRIATE FOR THE EFFECTIVE AND EFFICIENT ADMINISTRATION
OF THE FOOD STAMP PROGRAM, IT IS OUR VIEW THAT THE REGULATION IN
QUESTION CANNOT BE SAID TO HAVE BEEN ILLEGALLY ISSUED UNDER SECTION 4
(C) OF THE FOOD STAMP ACT OF 1964.
TO MR. SECRETARY:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 3, 1971, ASKING WHETHER
THERE IS LEGAL OBJECTION TO THE REVISED PROVISION IN THE REGULATIONS
GOVERNING THE FOOD STAMP PROGRAM WHICH PERMITS AUTHORIZED FOOD STORES TO
RETURN CASH CHANGE NOT EXCEEDING 49 CENTS TO AN ELIGIBLE HOUSEHOLD IN A
FOOD STAMP TRANSACTION.
QUESTION ARISES AS TO THE VALIDITY OF SUCH REVISED REGULATION BECAUSE
OF SECTION 6(B) OF THE FOOD STAMP ACT OF 1964, AS AMENDED, 7 U.S.C.
2015(B), WHICH PROVIDES IN PART THAT -
"COUPONS ISSUED TO ELIGIBLE HOUSEHOLDS SHALL BE USED BY THEM ONLY TO
PURCHASE FOOD IN RETAIL STORES WHICH HAVE BEEN APPROVED FOR
PARTICIPATION IN THE FOOD STAMP PROGRAM *** ."
IT IS EXPLAINED THAT UNDER THE FOOD STAMP PROGRAM, AUTHORIZED FOOD
RETAILERS ACCEPT FOOD COUPONS FROM PARTICIPATING HOUSEHOLDS IN PAYMENT
FOR ELIGIBLE FOOD. THE SMALLEST DENOMINATION OF COUPON USED IN THE
PROGRAM IS 50 CENTS. CONSEQUENTLY, THERE ARE TRANSACTIONS IN WHICH IT
IS NECESSARY FOR RETAILERS TO MAKE CHANGE FOR FOOD CUSTOMERS IN AMOUNTS
OF LESS THAN 50 CENTS.
THE REVISED REGULATIONS WERE PUBLISHED IN THE FEDERAL REGISTER OF
DECEMBER 30, 1970, 35 F.R. 19737, AND PRIOR THERETO, THE PROGRAM
REGULATIONS PROVIDED FOR THE USE OF CREDIT SLIPS AS CHANGE. IN THIS
REGARD THE REGULATIONS SET OUT IN 7 CFR 1602.2(D) PROVIDED AS FOLLOWS:
"CHANGE IN CASH SHALL NOT BE GIVEN FOR COUPONS, BUT AN AUTHORIZED
RETAIL FOOD STORE MAY USE FOR THE PURPOSE OF MAKING CHANGE, THOSE
UNCANCELLED AND UNENDORSED COUPONS HAVING A DENOMINATION OF 50 CENTS
WHICH WERE PREVIOUSLY ACCEPTED IN EXCHANGE FOR ELIGIBLE FOODS. IF
CHANGE IN AN AMOUNT OF LESS THAN 50 CENTS IS REQUIRED, THE ELIGIBLE
HOUSEHOLD SHALL HAVE THE OPTION OF PAYING IN CASH OR RECEIVING CREDIT
FROM THE AUTHORIZED RETAIL FOOD STORE FOR FUTURE DELIVERY OF AN
EQUIVALENT VALUE OF ELIGIBLE FOODS. AT NO TIME MAY CREDIT RETURNED AS
CHANGE TO ELIGIBLE HOUSEHOLDS BE IN EXCESS OF 49 CENTS."
AS INDICATED ABOVE, SUCH PART OF THE REGULATIONS (NOW SECTION
272.2(D)) HAS BEEN REVISED AND READS AS FOLLOWS:
"AN AUTHORIZED RETAIL FOOD STORE MAY USE FOR THE PURPOSE OF MAKING
CHANGE, THOSE UNCANCELLED AND UNENDORSED COUPONS HAVING A DENOMINATION
OF 50 CENTS WHICH WERE PREVIOUSLY ACCEPTED IN EXCHANGE FOR ELIGIBLE
GOODS. IF CHANGE IN AN AMOUNT OF LESS THAN 50 CENTS IS REQUIRED, THE
ELIGIBLE HOUSEHOLD SHALL RECEIVE THE CHANGE IN CASH. AT NO TIME MAY
CASH CHANGE IN EXCESS OF 49 CENTS BE RETURNED TO AN ELIGIBLE HOUSEHOLD."
IT IS REPORTED THAT VARIOUS DIFFICULTIES WERE ENCOUNTERED IN
CONNECTION WITH THE ISSUANCE BY RETAILERS OF SO-CALLED "CREDIT SLIPS" AS
CHANGE. FIRST, THE ISSUANCE OF CREDIT SLIPS WAS THE MOST DIFFICULT PART
OF FOOD STAMP TRANSACTIONS FOR RETAILERS AND RESULTED IN
MISUNDERSTANDINGS AND MANY CHANGE-MAKING VIOLATIONS. THE PREPARATION
AND ISSUANCE OF CREDIT SLIPS SLOWED DOWN THE CHECKOUT PROCESS, AND
CONSEQUENTLY SOME RETAILERS RESISTED ISSUING CREDIT SLIPS. FURTHER,
FOOD STAMP FAMILIES WERE LOSING A SIGNIFICANT AMOUNT OF COUPON BUYING
POWER BY FAILING TO USE THEIR CREDIT SLIPS. THE CREDIT SLIPS WERE
REDEEMABLE ONLY AT THE RETAIL STORES WHICH ISSUED THEM.
IN VIEW OF SUCH DIFFICULTIES THERE WERE CONSIDERED THE THREE
FOLLOWING ALTERNATIVES (1) TO MAKE COUPONS IN DENOMINATIONS OF LESS THAN
50 CENTS (2) TO AUTHORIZE STORES TO ISSUE CREDIT SLIPS OR TOKENS WHICH
COULD BE ACCEPTED FOR ELIGIBLE FOOD AT ANY AUTHORIZED RETAIL STORE AND
(3) TO PERMIT THE RETURN OF CASH CHANGE UP TO 49 CENTS.
YOU STATE THAT THE FIRST ALTERNATIVE WAS REJECTED BECAUSE PRINTING
AND HANDLING OF COUPONS IN SMALLER DENOMINATIONS THAN 50 CENTS WOULD
HAVE ADDED SUBSTANTIALLY TO THE ADMINISTRATIVE COSTS OF THE PROGRAM, AND
THAT THE SECOND ALTERNATIVE WAS REJECTED ON ADVICE OF THE OFFICE OF THE
GENERAL COUNSEL OF THE DEPARTMENT OF THE TREASURY THAT THE USE OF
COUPONS OR TOKENS INTERCHANGEABLY AMONG AUTHORIZED STORES IS PROHIBITED
BY FEDERAL MONETARY LAWS.
CONSEQUENTLY IN VIEW OF THE UNSATISFACTORY EXPERIENCE WITH THE
"CREDIT SLIP" METHOD OF CHANGE-MAKING, AND AFTER CONSIDERING THE
ALTERNATIVES SET OUT ABOVE, IT WAS DETERMINED ADMINISTRATIVELY THAT THE
PROVISION PERMITTING THE ISSUANCE OF CASH FOR CHANGE OF LESS THAN 50
CENTS IN FOOD COUPON TRANSACTIONS WAS NECESSARY AND APPROPRIATE FOR THE
EFFECTIVE AND EFFICIENT ADMINISTRATION OF THE FOOD STAMP PROGRAM.
WE NOTE THAT SECTION 6(A) OF THE FOOD STAMP ACT OF 1964 PROVIDES THAT
COUPONS SHALL BE PRINTED IN SUCH DENOMINATIONS AS MAY BE DETERMINED TO
BE NECESSARY. THE CONGRESS THUS HAS LEFT THE MATTER OF PRESCRIBING THE
DENOMINATIONS OF THOSE COUPONS TO THE DISCRETION OF THE SECRETARY.
CONSEQUENTLY, SINCE IT OBVIOUSLY WOULD BE IMPRACTICABLE TO ISSUE MINOR
DENOMINATIONS OF THE COUPONS IN THE SAME DENOMINATIONS AS CURRENCY, SOME
PROVISION WOULD HAVE TO BE MADE TO MAKE CHANGE IN A TRANSACTION
INVOLVING COUPONS.
SECTION 4(C) OF THE FOOD STAMP ACT OF 1964, AS AMENDED, PROVIDES:
"THE SECRETARY SHALL ISSUE SUCH REGULATIONS, NOT INCONSISTENT WITH
THIS ACT, AS HE DETERMINES NECESSARY OR APPROPRIATE FOR THE EFFECTIVE
AND EFFICIENT ADMINISTRATION OF THE FOOD STAMP PROGRAM."
SINCE YOU HAVE DETERMINED THAT THE PROVISION FOR PERMITTING THE
ISSUANCE OF CASH FOR CHANGE OF LESS THAN 50 CENTS IS NECESSARY AND
APPROPRIATE FOR THE EFFECTIVE AND EFFICIENT ADMINISTRATION OF THE FOOD
STAMP PROGRAM, IT IS OUR VIEW THAT THE REGULATION IN QUESTION CANNOT BE
SAID TO HAVE BEEN ILLEGALLY ISSUED UNDER THE FOREGOING PROVISION OF LAW.
WE BELIEVE, HOWEVER, THAT THE PROVISION FOR CASH CHANGE COULD BE MORE
EASILY JUSTIFIED UNDER THE DE MINIMUS RULE IF 25-CENT COUPONS WERE
ISSUED AND THE CASH CHANGE RESTRICTED TO NOT MORE THAN 24 CENTS. SINCE
THE CHANGE CAN BE USED TO PURCHASE INELIGIBLE ITEMS AND IT IS NOT
APPARENT TO US THAT THE PRINTING AND HANDLING COST OF ONE ADDITIONAL
DENOMINATION OF 25 CENTS WOULD ADD SUBSTANTIALLY TO THE ADMINISTRATIVE
COSTS OF THE PROGRAM, WE SUGGEST THAT THIS ALTERNATIVE BE CONSIDERED.
IF YOU DETERMINE THAT SUCH ALTERNATIVE IS NOT APPROPRIATE FOR THE
EFFECTIVE AND EFFICIENT ADMINISTRATION OF THE FOOD STAMP PROGRAM, THE
JUSTIFICATION FOR YOUR DETERMINATION SHOULD BE DOCUMENTED FOR
CONSIDERATION IN OUR REVIEW OF THE PROGRAM.
B-162538, MAY 10, 1971
CONTRACTS - PRICE ADJUSTMENTS
ADVISING THAT NO SUFFICIENT BASIS EXISTS TO SUBSTANTIATE A DEMAND BY
THE GOVERNMENT FOR A CONTRACT PRICE ADJUSTMENT INCIDENT TO PERFORMANCE
BY ACME INDUSTRIES, INC., ON AN AIR FORCE CONTRACT FOR THE FURNISHING OF
TRAILER MOUNTED AIR CONDITIONERS.
BASED ON A REVIEW OF CONTRACT RECORDS AND DISCUSSIONS BETWEEN GAO
AUDITORS AND THE PROCURING ACTIVITY, IT APPEARS THAT NO COSTS BENEFITS
SHOULD INURE TO THE GOVERNMENT UNDER THE INSTANT CONTRACT SINCE THE
WEIGHT AND SIZE RESTRICTIONS WERE WAIVED BY THE PROCURING ACTIVITY IN
RESPONSE TO SPECIFICATION CHANGES.
TO KECO INDUSTRIES, INC.
WE REFER TO YOUR LETTER OF JULY 23, 1970, CONCERNING CERTAIN EXPENSES
INCIDENT TO PERFORMANCE BY ACME INDUSTRIES, INC. (ACME) OF DEPARTMENT OF
THE AIR FORCE CONTRACT F41608-67-C-1139 FOR THE FURNISHING OF MA-3
TRAILER MOUNTED AIRCONDITIONERS IN CONFORMITY WITH MILITARY
SPECIFICATION MIL-A-26107D(USAF), OCTOBER 5, 1960, AS AMENDED. THE
PROCURING ACTIVITY IS SAN ANTONIO AIR MATERIEL AREA (SAAMA).
A SUMMARY OF YOUR CONTENTIONS, TOGETHER WITH OUR COMMENTS, BASED ON
REVIEW OF THE CONTRACT RECORDS AND DISCUSSIONS BY OUR AUDITORS OF THE
ITEMS INVOLVED WITH SAAMA REPRESENTATIVES, APPEARS BELOW:
1. COIL COST DIFFERENCE -
YOU STATE THAT THE SPECIFICATION CALLED FOR A CONDENSER COIL
CONSTRUCTED OF COPPER FINS AND COPPER TUBES; THAT ACME SAVED AS MUCH
AS, OR MORE THAN, $300 PER UNIT BY USING ALUMINUM FINS IN THE CONDENSER;
AND THAT SUCH SAVING SHOULD BE PASSED ON TO THE GOVERNMENT.
ACME'S TECHNICAL PROPOSAL, AS SUBMITTED TO AND APPROVED BY SAAMA IN
THE FIRST STEP OF THE PROCUREMENT, SHOWED THAT ACME PLANNED TO USE
ALUMINUM FOR THE CONDENSER FINS. ACME'S BID, ACCEPTED BY SAAMA IN THE
SECOND STEP OF THE PROCUREMENT, INCLUDED THE SAME TECHNICAL PROPOSAL.
IN ADDITION, THE SAAMA PROJECT ENGINEER INFORMED OUR REPRESENTATIVES
THAT IT WAS THE INTENT OF THE GOVERNMENT TO PERMIT USE OF EITHER COPPER
OR ALUMINUM FOR THE CONDENSER FINS BUT THE AUTHORIZATION THEREFOR WAS
OMITTED FROM THE SPECIFICATION DUE TO A TRANSCRIPTION ERROR.
WHILE IT IS REGRETTABLE THAT SAAMA FAILED TO ADVISE YOU OF ITS INTENT
IN THIS REGARD, WE SEE NO BASIS FOR CONCLUDING THAT ACME'S BID PRICE OF
$7,500 PER UNIT WAS BASED ON OTHER THAN THE USE OF ALUMINUM FOR THE
CONDENSER FINS AS INDICATED IN ITS TECHNICAL PROPOSAL. WE ARE UNABLE,
THEREFORE, TO VIEW THE USE OF ALUMINUM FINS BY ACME AS A CHANGE IN ITS
OFFERED END PRODUCT INCIDENT TO WHICH A COST BENEFIT SHOULD INURE TO THE
GOVERNMENT.
2. ALTERNATING CURRENT MOTORS -
YOU STATE THAT SINCE THE SPECIFICATION CHANGE WHICH PERMITTED THE USE
OF AN ELECTRIC MOTOR TO DRIVE THE COOLING AIR FAN DID NOT PERMIT USE OF
AN AC MOTOR, ACME SHOULD BE REQUIRED EITHER TO SUBSTITUTE DC MOTORS FOR
ANY AC MOTORS USED IN ACME'S UNITS OR TO PAY TO THE GOVERNMENT THE SUM
SAVED BY REASON OF ANY SUCH SUBSTITUTION.
OUR REPRESENTATIVES WERE UNABLE TO DETERMINE THE DETAILS, SUCH AS
DIMENSIONS AND POWER REQUIREMENTS, OF THE DC MOTOR WHICH ACME'S
TECHNICAL PROPOSAL INDICATED WOULD BE USED TO DRIVE THE COOLING AIR FAN.
ACME OFFICIALS STATED THAT THEY HAD OBTAINED TENTATIVE ESTIMATES FOR
TWO DIFFERENT MODELS OF DC MOTORS (AT THE TIME THE ACME TECHNICAL
PROPOSAL WAS PREPARED); HOWEVER, THERE WAS NO DOCUMENTATION FOR THE
ESTIMATED COSTS OF THE MOTORS OR FOR THE ESTIMATED COSTS FOR ADDITIONAL
MATERIAL INCIDENT TO USE OF AC MOTORS. IN THE CIRCUMSTANCES, THERE DOES
NOT APPEAR TO BE ANY AVAILABLE DATA WHICH MIGHT ASSIST THE GOVERNMENT IN
OBTAINING ANY PRICE ADJUSTMENT INCIDENT TO USE BY ACME OF AC MOTORS TO
DRIVE THE COOLING AIR FANS.
3. STEEL V ALUMINUM -
YOU STATE THAT YOUR OBSERVATION OF ACME'S AIRCONDITIONER INDICATES
THAT IT HAS BEEN CONSTRUCTED OF STEEL IN LIEU OF ALUMINUM AS REQUIRED BY
THE SPECIFICATION. YOU ACCORDINGLY URGE THAT THERE WAS A CONSIDERABLE
SAVING TO ACME DUE TO THE LOWER PRICE OF STEEL, WHICH SHOULD BE
RECOVERED BY THE GOVERNMENT.
REFERENCE TO THE MILITARY SPECIFICATION SHOWS THAT WHILE CERTAIN
COMPONENTS OF THE AIRCONDITIONER ARE REQUIRED TO BE MADE OF A SPECIFIC
METAL (E.G., THE EXHAUST STACK SHALL BE OF STAINLESS STEEL), THE METAL
TO BE USED IN OTHER COMPONENTS IS NOT SO RESTRICTED. THE CABINET, FOR
EXAMPLE, IS TO BE "LIGHTWEIGHT METALLIC MATERIAL", WHILE THE TRAILER
FRAME IS TO BE OF METAL CONSTRUCTION OF SUFFICIENT SIZE AND STRENGTH TO
ACCOMMODATE ALL COMPONENTS OF THE AIRCONDITIONER.
SAAMA INFORMED OUR REPRESENTATIVES THAT EXCEPT FOR CERTAIN MATERIAL
REQUIRED BY THE SPECIFICATIONS TO BE USED IN THE AIRCONDITIONER, ACME
WAS NOT ADVISED AS TO THE TYPE OF MATERIAL TO USE IN ITS UNIT. A SAAMA
ENGINEER INDICATED THAT THE ACME UNIT HAS A STEEL CABINET.
OUR REPRESENTATIVES FOUND NO EVIDENCE THAT ACME HAD USED STEEL TO
CONSTRUCT ANY COMPONENT WHICH WAS REQUIRED BY THE SPECIFICATION TO BE
CONSTRUCTED OF ALUMINUM. IT WOULD NOT APPEAR, THEREFORE, THAT ACME
EFFECTED ANY SAVING BY SUBSTITUTION OF STEEL FOR ALUMINUM IN DISREGARD
OF THE REQUIREMENTS OF THE SPECIFICATION.
4. TRANSPORTATION COSTS -
YOU STATE THAT ACME'S AIRCONDITIONER EXCEEDS THE WEIGHT LIMITATION OF
6,800 POUNDS PRESCRIBED IN THE SPECIFICATION. YOU ACCORDINGLY ESTIMATE
THAT THE INCREASED WEIGHT WOULD ACCOUNT FOR ADDITIONAL TRANSPORTATION
COSTS OF $500,000.
THE CONTRACTING OFFICER ADVISED OUR REPRESENTATIVES THAT THE ACME
UNIT WEIGHS 8,000 POUNDS, OR 1,200 POUNDS OVER THE LIMITATION STATED IN
THE MILITARY SPECIFICATION, AND THE CONTRACT RECORDS SHOW THAT THE ACME
UNIT IS ALSO SOME 12 INCHES LONGER THAN THE LENGTH ORIGINALLY
CONTEMPLATED. BOTH OF THESE LIMITATIONS, HOWEVER, WERE WAIVED BY THE
SAAMA SERVICE ENGINEERING DIVISION ON AUGUST 11, 1967.
THE WEIGHT INCREASE, ACCORDING TO THE CONTRACT RECORDS, RESULTED FROM
THE SPECIFICATION CHANGE WHICH PERMITTED USE OF INDIRECT DRIVE OF THE
GOVERNMENT COMPRESSOR AS AN ALTERNATIVE TO THE DIRECT DRIVE ORIGINALLY
SPECIFIED. INCIDENT TO THE USE OF THE INDIRECT DRIVE BY ACME A FLOATING
TRANSMISSION WAS ADDED TO THE AIRCONDITIONER; A JACKSHAFT WAS USED TO
PREVENT SIDELOADING OF THE COMPRESSOR; AND TO ACCOMMODATE THE JACKSHAFT
THE COMPRESSOR WAS NECESSARILY RELOCATED TO THE REAR OF THE
AIRCONDITIONER. THE RELOCATION OF THE COMPRESSOR, SAAMA EXPLAINED,
REQUIRED LENGTHENING OF THE AIRCONDITIONER CHASSIS BY 12 INCHES, AND THE
OVERALL WEIGHT OF THE UNIT WAS FURTHER INCREASED BY THE USE OF HEAVIER
RUNNING GEAR - SPRINGS, AXLES, TOWBAR, ETC. - TO COMPENSATE FOR THE
INCREASED WEIGHT OF THE JACKSHAFT AND THE EXTENDED CHASSIS.
DOCUMENTATION FROM WHICH THE WEIGHT OF THE ADDITIONAL COMPONENTS
COULD BE DETERMINED IS NOT AVAILABLE. HOWEVER, OUR REPRESENTATIVES
FOUND NO EVIDENCE THAT THE WEIGHT INCREASE WAS OCCASIONED BY ANY
UNAUTHORIZED USE OF STEEL BY ACME.
IN LIGHT OF THE FOREGOING, WE DO NOT BELIEVE THAT A SUFFICIENT BASIS
EXISTS TO SUBSTANTIATE A DEMAND BY THE GOVERNMENT FOR A CONTRACT PRICE
ADJUSTMENT IN ANY OF THE AREAS IN QUESTION.
B-170544, MAY 10, 1971
BID PROTEST - EVALUATION FACTORS - INCORRECT COMPUTATION
DENYING PROTEST OF DYNAMICS CORPORATION OF AMERICA, FERMONT DIVISION,
AGAINST THE AWARD OF A CONTRACT TO WHITTAKER CORPORATION, HOL-GAR
DIVISION, UNDER AN RFP ISSUED BY THE DEFENSE GENERAL SUPPLY CENTER,
RICHMOND, VA., FOR DIESEL-ELECTRIC GENERATOR SETS AND WHEEL MOUNTINGS.
WHERE THE GOVERNMENT HAD AN OPTION TO ORDER ALL GENERATOR SETS AS
EITHER SKID MOUNTED OR WHEEL MOUNTED, THE PROPER FACTOR FOR EVALUATION
OF THE WHEEL MOUNTINGS MUST BE AS CLOSE AS POSSIBLE TO THE GOVERNMENT'S
ACTUAL NEEDS, IN THIS CASE 15, FOR THE ESTIMATED NUMBER OF SETS TO BE
ORDERED WITH WHEELS AND NOT THE POSSIBLE 165, THE MAXIMUM NUMBER OF SETS
THAT MIGHT BE ORDERED WITH WHEELS. WHILE THE SOLICITATION DID NOT
SPECIFICALLY IDENTIFY THE TOTAL ANNUAL ESTIMATED QUANTITY AS THE FACTOR
TO BE USED, SUCH IMPLICATION WAS APPARANT FROM ITS WORDING.
TO FERMONT DIVISION OF DYNAMICS CORPORATION OF AMERICA
FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF JANUARY 29, 1971, AND
SUBSEQUENT COMMUNICATIONS, PROTESTING THE AWARD OF A CONTRACT TO HOL-GAR
DIVISION OF WHITTAKER CORPORATION (HOL-GAR) FOR ITEMS 1, 2, 3, 4, 7 AND
8 UNDER REQUEST FOR PROPOSALS (RFP) NO. DSA 400-70-R-8075 ISSUED BY THE
DEFENSE GENERAL SUPPLY CENTER, RICHMOND, VIRGINIA, ON JUNE 30, 1970.
YOUR FIRM WAS AWARDED ITEMS 5, 6, 9 AND 10.
THE SOLICITATION REQUESTED OFFERS FOR FIVE DIFFERENT SIZES OF
DIESEL-ELECTRIC GENERATOR SETS, AND FIVE COMPATIBLE SIZES OF WHEEL
MOUNTINGS, PLUS DATA. THE PROCUREMENT WAS UNDERTAKEN TO SATISFY THE
REQUIREMENTS OF A MILITARY INTERDEPARTMENTAL PURCHASE REQUEST (MIPR)
FROM THE DEPARTMENT OF THE AIR FORCE REFLECTING THAT THE REQUIREMENTS TO
BE COVERED ARE BASICALLY THOSE OF FISCAL YEAR 1971, WITH THE AIR FORCE
FURNISHING ITS BEST ESTIMATE FOR THE QUANTITY OF EACH OF THE GENERATOR
SETS AND WHEEL MOUNTINGS IT ANTICIPATED WOULD BE REQUIRED.
YOU ASSERT THAT THE GOVERNMENT DID NOT PROPERLY AND ACCURATELY
UTILIZE THE EVALUATION FACTORS SET FORTH IN THE SOLICITATION. THE
PERTINENT EVALUATION FACTORS SET FORTH IN SECTION D, PAGES 21 AND 21A OF
AMENDMENT NUMBER 6 PROVIDED:
"THE GOVERNMENT WILL MAKE AWARDS TO THE LOW RESPONSIVE RESPONSIBLE
OFFERORS BASED ON THE BELOW FORMULA:
"A. THE UNIT PRICES OFFERED FOR EACH INCREMENT OF EACH GENERATOR SET
SIZE WILL BE MULTIPLIED BY THE ESTIMATED NUMBER OF UNITS TO BE ORDERED
IN EACH INCREMENT. THESE EXTENDED AMOUNTS WILL BE ADDED TO ARRIVE AT A
TOTAL PRICE FOR THE ESTIMATED TOTAL ANNUAL QUANTITIES FOR EACH SIZE SET.
"B. PLUS THE UNIT PRICE OFFERED FOR EACH SIZE WHEEL MOUNTING WILL BE
MULTIPLIED BY THE TOTAL ANNUAL ESTIMATED QUANTITY OF THAT SIZE.
"D. PLUS THE PRICES OFFERED FOR LEVELS OF PRESERVATION, PACKAGING
AND PACKING FOR EACH FSN (SEE PAGE 40) WILL BE ADDED THEN DIVIDED BY 3
TO ARRIVE AT AN AVERAGE UNIT PRICE WHICH WILL BE MULTIPLIED BY THE TOTAL
ANNUAL ESTIMATED QUANTITY."
SINCE A COMMON PROCEDURE WAS USED TO EVALUATE EACH SIZE GENERATOR AND
WHEEL MOUNTS, OUR DISCUSSION OF THIS ISSUE WILL BE LIMITED TO THE
PROPRIETY OF THE EVALUATION OF THE FIRST SIZE GENERATOR SET, THE MB-19
(ITEM 1) AND THE ASSOCIATED WHEEL MOUNTS (ITEM 2).
AS SHOWN IN THE RFP, THE GOVERNMENT ESTIMATED THAT IT WOULD REQUIRE
165 MB-19S ANNUALLY, ALL OF WHICH WOULD BE SKID MOUNTED BECAUSE OF THE
CONFIGURATION OF THE SET. HOWEVER, IT WAS ESTIMATED THAT OF THIS NUMBER
OF SKID MOUNTED SETS, 15 WERE ESTIMATED TO BE REQUIRED WITH ADDITIONAL
WHEEL MOUNTINGS, WITH THE NOMENCLATURE OF MB-19W BEING GIVEN TO THOSE
SETS WITH WHEELS. FOR ITEM 2 THE RFP PROVIDED:
"(SAME AS ITEM 1 ABOVE, BUT WHEEL MOUNTED FOR 5 MPH TOWING, TYPE
MB-19W)
FOB ORIGIN
TOTAL ANNUAL ESTIMATED QUANTITY - 15 EA
THE ESTIMATED ANNUAL QUANTITY FOR THIS ITEM IS INCLUDED IN THE
ESTIMATED ANNUAL QUANTITY FOR ITEM 1 ABOVE.
THESE UNIT PRICES TO BE FOR WHEEL MOUNTING ONLY."
SPECIFICALLY, YOU ARGUE THAT "WITH RESPECT TO ITEMS 1 AND 2 THE
GOVERNMENT IN EVALUATING THE BIDS UNDER SECTION D(B) ONLY USED A FACTOR
OF 15 TO MULTIPLY BY THE COST QUOTED FOR ITEM 2, WHEEL MOUNTING, WHEN IT
SHOULD HAVE USED A FACTOR OF 165 WHICH WAS THE STATED TOTAL 'ANNUAL
ESTIMATED QUANTITY OF THAT SIZE'."
THE INTERPRETATION GIVEN THE ABOVE-QUOTED PORTION OF SECTION D(B) BY
THE CONTRACTING OFFICER IS THAT:
"THIS SENTENCE DISCUSSES ONLY WHEEL MOUNTING AND THAT IT IS APPARENT
THAT THE GOVERNMENT INTENDS TO MULTIPLY THE UNIT PRICE OFFERED FOR EACH
SIZE WHEEL MOUNTING BY THE TOTAL ANNUAL ESTIMATED QUANTITY OF THAT SIZE
WHEEL MOUNTING WHICH IT IS ANTICIPATED WILL BE REQUIRED."
IN SUPPORT OF YOUR ARGUMENT ON THIS ISSUE YOU OBSERVE THAT SINCE THE
"NOTICE" CLAUSE ON PAGE 32 OF AMENDMENT 6 INDICATES THE GOVERNMENT HAD
THE OPTION TO ORDER ALL GENERATOR SETS OF EACH SIZE AS EITHER SKID
MOUNTED OR WHEEL MOUNTED, A FACTOR OF 165 IN THE CASE OF THE MB-19 SIZE
WHEEL MOUNTINGS WOULD HAVE BEEN THE APPROPRIATE FACTOR FOR EVALUATION
PURPOSES. THIS CONTENTION MUST FAIL SINCE IT IS WELL ESTABLISHED THAT
EVALUATION FACTORS MUST BE REALISTIC IN COMPARISON WITH THE GOVERNMENT'S
ACTUAL NEEDS, AND THE RESERVING OF THE ABOVE OPTION DOES NOT DETRACT
FROM THE FACT THAT THE GOVERNMENT'S BEST ESTIMATES OF ITS NEEDS WERE
THAT 150 SETS OF THE MB-19 SIZE WOULD BE ORDERED ANNUALLY AS SKID UNITS
AND THAT ONLY 15 SETS WOULD BE ORDERED WITH WHEELS. THE USE OF AN
EVALUATION FACTOR OF OTHER THAN 15 FOR THE WHEEL MOUNTINGS COVERED BY
ITEM 2 WOULD HAVE BEEN INCONSISTENT WITH THE GOVERNMENT'S ESTIMATED
REQUIREMENTS AND THEREFORE IMPROPER.
IN ADDITION, YOU SAY THAT SINCE THE EVALUATION FACTOR IN SECTION DD
CONCERNING PRESERVATION AND PACKAGING UTILIZED A QUANTITY OF 180 UNITS
IN THE CASE OF MB-19S, WHICH WAS IN EXCESS OF THE 165 TOTAL ANNUAL
ESTIMATED QUANTITIES OF THAT SIZE, FERMONT BELIEVED THAT SINCE A
PHILOSOPHY OF EVALUATION BASED ON QUANTITIES IN EXCESS OF INTENDED
PURCHASE HAD BEEN ESTABLISHED BY SECTION DD, THAT SIMILAR EVALUATION WAS
INTENDED TO BE USED FOR SECTION DB. WE HAVE BEEN INFORMALLY ADVISED,
HOWEVER, THAT THE EVALUATION FACTOR USED UNDER SECTION DD IN THE CASE OF
MB-19S WAS NOT 180 UNITS, AS YOU CONTEND, BUT RATHER A TOTAL OF 165 -
150 UNITS AS SKID MOUNTED AND 15 AS WHEEL MOUNTED. WE CONSIDER THE USE
OF THE 150 SKID UNITS AND THE 15 WHEEL UNITS IN EVALUATING THE
PRESERVATION AND PACKING COSTS TO BE IN ACCORD WITH THE PLAIN
NOTIFICATION IN THE RFP THAT THE 165 TOTAL ANNUAL ESTIMATED QUANTITY IS
INCLUSIVE OF THE 15 WHEEL UNITS.
WITH REFERENCE TO SECTION DB, THAT SECTION DOES NOT SPECIFICALLY
IDENTIFY THE TOTAL ANNUAL ESTIMATED QUANTITY DESIGNATED THEREIN AS THE
MULTIPLICATION FACTOR TO BE USED. WE AGREE, HOWEVER, WITH THE POSITION
OF THE CONTRACTING OFFICER THAT SINCE SECTION DBDEALS SOLELY WITH THE
EVALUATION OF WHEEL MOUNTINGS, AND A TOTAL ANNUAL ESTIMATED QUANTITY IS
FURNISHED FOR EACH ITEM CONCERNING WHEEL MOUNTINGS, THE LOGICAL IMPORT
OF SECTION DBIS THAT THE MULTIPLICATION FACTOR REFERRED TO THEREIN IS
THE TOTAL ANNUAL ESTIMATED QUANTITY SHOWN UNDER EACH ITEM FOR WHEEL
MOUNTINGS RATHER THAN THE TOTAL ANNUAL ESTIMATED QUANTITY FOR BOTH WHEEL
AND SKID UNITS SHOWN UNDER OTHER ITEMS.
WHILE THE REFERENCES IN THE PERTINENT EVALUATION FACTORS TO TOTAL
ANNUAL ESTIMATED QUANTITIES MAY NOT REFLECT THE MOST DESIRABLE DEGREE OF
SPECIFICITY, IT IS OUR VIEW THAT THE INTENDED TOTAL ANNUAL ESTIMATED
QUANTITIES WERE ADEQUATELY ASCERTAINABLE FROM THE PROVISIONS OF THE
SOLICITATION. SINCE WE CANNOT FIND THAT THE METHOD OF EVALUATION
UTILIZED BY THE AGENCY WAS IMPROPER OR CONTRARY TO THE TERMS OF THE
SOLICITATION, OR THAT ALL OFFERS WERE NOT EVALUATED ON THE SAME BASIS,
WE PERCEIVE NO LEGAL OBJECTION TO THE EVALUATION PROCEDURES USED IN
MAKING THE AWARDS TO YOUR FIRM AND HOL-GAR.
YOU ALSO CONTEND THAT SINCE THE GOVERNMENT APPARENTLY DID NOT
CONSIDER ANY OTHER FACTORS BUT PRICE IN MAKING THE AWARDS, THERE WAS NO
REASON FOR THE GOVERNMENT TO HAVE UTILIZED A NEGOTIATED PROCUREMENT
PROCEDURE, BUT RATHER AN ADVERTISED PROCUREMENT WOULD HAVE BEEN THE
PROPER MODE OF PROCUREMENT.
THE INSTANT PROCUREMENT WAS NEGOTIATED UNDER 10 U.S.C. 2304(A)(13)
PURSUANT TO A SECRETARIAL DETERMINATION AND FINDING (D&F) BY THE AIR
FORCE, SUBSEQUENT TO AND IN CONSONANCE WITH OUR DECISION B-153145, APRIL
27, 1964, COPY ENCLOSED, WHEREIN WE CONSIDERED THE NEED OF THE AIR FORCE
TO STANDARDIZE THE GENERATOR SETS INCLUDED IN THIS PROCUREMENT. WE
CONCLUDED THAT SUCH D&F WOULD BE REQUIRED BEFORE SUCH PROCUREMENT COULD
BE CONSUMMATED, ESPECIALLY WHERE PROPRIETARY SUBITEMS WERE BEING
PROCURED. WHILE IT IS CLEAR THAT SINCE THE GENERATOR SETS BEING PROCURED
ARE STANDARDIZED IN THEIR MAIN COMPONENTS THE GOVERNMENT IS PRIMARILY
INTERESTED IN OFFERED PRICES, THIS IN NO WAY AFFECTS THE RIGHT OF THE
GOVERNMENT TO EMPLOY THIS METHOD OF PROCUREMENT USING EXISTING, BUT
RESTRICTIVE, DRAWINGS AND DATA WHICH SPECIFY CERTAIN COMPONENTS BY
MANUFACTURER'S MAKE AND MODEL. IN ANY EVENT, SUCH DETERMINATIONS ARE
MADE FINAL UNDER 10 U.S.C. 2310(B).
LASTLY, YOU SUBMIT THAT IT WOULD HAVE COST THE GOVERNMENT ONLY
APPROXIMATELY $17,000 MORE TO HAVE AWARDED THE ENTIRE CONTRACT TO
FERMONT, AND A SINGLE AWARD AS OPPOSED TO SPLIT AWARDS WOULD HAVE BEEN
IN THE BEST INTEREST OF THE GOVERNMENT SINCE THIS PRICE DIFFERENCE WOULD
HAVE BEEN MORE THAN OFFSET BY THE ADDITIONAL COSTS WHICH WILL BE
INCURRED THROUGH AWARDING TWO CONTRACTS. OUR OFFICE HAS HELD THAT IN
DETERMINING THE BEST INTEREST OF THE GOVERNMENT IN THESE MATTERS, THE
PHRASE "PRICE AND OTHER FACTORS CONSIDERED" DOES NOT JUSTIFY AWARD TO
OTHER THAN THE LOW BIDDER OR OFFEROR, UNLESS THE PROSPECTIVE CONTRACTOR
IS FOUND NOT QUALIFIED. O7 COMP. GEN. 550 (1958). CONSIDERATIONS OF
CENTRALIZED MANAGEMENT, ADMINISTRATION, ADDITIONAL CONFERENCES AND FIRST
ARTICLE TESTING MAY JUSTIFY A SINGLE AWARD AT A HIGHER PRICE ONLY WHEN
THE HIGHER COST IS CLEARLY OFFSET BY ADMINISTRATIVE SAVINGS; AND EVEN
IN THOSE CIRCUMSTANCES THE SOLICITATION MUST PROVIDE FOR SUCH AWARD AND
ESTABLISH THE ADMINISTRATIVE COST SAVING TO BE USED IN EVALUATING THE
OFFERS. CF. 47 COMP. GEN. 233 (1967). NO SUCH PROVISION WAS CONTAINED
IN THE INSTANT SOLICITATION, AND THE CONTRACTING OFFICER HAS DETERMINED
THAT ANY ADMINISTRATIVE SAVINGS SUBJECT TO BEING REALIZED ON THE ABOVE
BASES COULD NOT BE ANYWHERE CLOSE TO THE $17,000 FIGURE WHICH YOU
MENTION.
FOR THE FOREGOING REASONS, YOUR PROTEST IS DENIED.
B-171825, MAY 10, 1971
TRANSPORTATION CHARGES - PAYMENT TO CONNECTING CARRIER
AFFIRMING PRIOR SETTLEMENT CERTIFICATE WHICH DISALLOWED CLAIM BY
SMYTH WORLDWIDE MOVERS, INC., FOR TRANSPORTATION CHARGES OF $947.44 IN
CONNECTION WITH A SHIPMENT OF HOUSEHOLD GOODS FROM ANCHORAGE, ALASKA TO
FORT MEADE, MD.
BECAUSE THE GBL WAS ISSUED BY AR-DEES ALASKA TRUCK LINES, INC., AND
VON DER AHE VAN LINES, INC., WAS LISTED AS CONNECTING CARRIER, PAYMENT
WAS MADE TO D.A.D. LEASING COMPANY UPON PRESENTATION OF THE ORIGINAL GBL
AND ITS REPRESENTATION THAT IT WAS BILLING AS AGENT FOR VON DER AHE.
ANY ADJUSTMENT BETWEEN CLAIMANT AND D.A.D. IS A MATTER FOR SETTLEMENT
BETWEEN THEM ALONE AND THE GOVERNMENT IS UNDER NO LEGAL OBLIGATION TO
DISTRIBUTE MONIES APPARENTLY PROPERLY PAID TO A CARRIER WHICH
PARTICIPATED IN TRANSPORTATION SERVICES FURNISHED THE UNITED STATES.
TO SMYTH WORLDWIDE MOVERS, INC.
WE REFER AGAIN TO YOUR LETTER OF JANUARY 18, 1971, WITH ENCLOSURES,
WHICH IN EFFECT REQUESTS REVIEW OF OUR SETTLEMENT CERTIFICATE OF
DECEMBER 29, 1970 (OUR CLAIM NO. TK-919266). THE SETTLEMENT DISALLOWED
YOUR CLAIM FOR TRANSPORTATION CHARGES OF $947.44 (YOUR BILL NO. K33092)
IN CONNECTION WITH A SHIPMENT OF HOUSEHOLD GOODS TRANSPORTED FROM
ANCHORAGE, ALASKA, TO FORT GEORGE G. MEADE, MARYLAND, UNDER GOVERNMENT
BILL OF LADING NO. D-3899044, DATED JUNE 26, 1968, ISSUED BY AR-DEES
ALASKA TRUCK LINES, INC. (SMYTH OVERSEAS VAN LINES (ALSO KNOWN AS SMYTH
WORLDWIDE MOVERS, INC.)).
THE CLAIM WAS DISALLOWED BECAUSE D.A.D. LEASING COMPANY, INC., ON ITS
BILL NO. 0073, CLAIMED $816.40 FOR THESE SERVICES AND WAS PAID THAT
AMOUNT BY THE U.S. FINANCE CENTER AS D.O. VOUCHER NO. 059962 ON APRIL
11, 1969.
THE PAYEE WAS SHOWN ON THE BILL AS "D.A.D. LEASING CO., INC. HAULING
AGENT VON DER AHE VAN LINES, INC."; THE BILL WAS SUPPORTED BY ORIGINAL
GOVERNMENT BILL OF LADING NO. D-3899044 SHOWING "D.A.D. LEASING, CO.,
INC." AS THE DELIVERING CARRIER. THE BILL OF LADING ALSO SHOWS THAT THE
SHIPMENT WAS TENDERED TO AR-DEES ALASKA TRUCK LINES, INC. (SMYTH
OVERSEAS VAN LINES) AND IS ROUTED VIA VON DER AHE VAN LINES, INC.
THE BILL ALSO WAS SUPPORTED BY AR-DEES ALASKA TRUCK LINES COMBINED
UNIFORM HOUSEHOLD GOODS BILL OF LADING AND FREIGHT BILL, DATED JUNE 26,
1968, WHICH SHOWS "VON DER AHE AT ST. PAUL TO DEST." IN THE SPACE FOR
CONNECTING OR INTERLINING CARRIER. OTHER DOCUMENTS SUPPORTING THE BILL
WERE A DRIVER'S WEIGHT CERTIFICATE, A SCALE WEIGHT CERTIFICATE OF THE
HOWE RICHARDSON SCALE COMPANY AND A DD FORM 619, STATEMENT OF
ACCESSORIAL SERVICES PERFORMED.
THE PAYMENT WAS APPARENTLY MADE TO D.A.D. LEASING COMPANY BY THE
DISBURSING OFFICER BECAUSE D.A.D. LEASING REPRESENTED THAT IT WAS
BILLING AS AGENT FOR VON DER AHE AND HAD POSSESSION OF THE MOST
IMPORTANT DOCUMENT WHICH WOULD BE REQUIRED IN BILLING FOR THE CHARGES -
THE ORIGINAL GOVERNMENT BILL OF LADING - WHICH SHOWS VON DER AHE VAN
LINES AS A PARTICIPATING CARRIER AND ON WHICH THE CONSIGNEE'S
CERTIFICATE OF DELIVERY WAS ACCOMPLISHED TO INDICATE THAT THE GOODS WERE
RECEIVED IN APPARENT GOOD ORDER AND CONDITION FROM D.A.D. LEASING
COMPANY, INC., AT FORT MEADE, MARYLAND. SEE 4 CFR 52.38 (1970 EDITION).
WHILE YOU INDICATE THAT SOME OF THE DOCUMENTS SUPPORTING D.A.D.
LEASING'S BILL ARE FALSE OR IMPROPERLY EXECUTED AND THAT THE BILL ITSELF
IS FRAUDULENT, OUR RECORDS DO NOT CONTAIN ANY FACTUAL EVIDENCE THAT
UNCONTROVERTEDLY SUPPORTS THOSE ALLEGATIONS. IN VIEW OF THIS AND OTHER
FACTUAL CONTRADICTIONS IN THE PRESENT RECORD AND BECAUSE OF THE
POSSIBILITY THAT UPON RESOLUTION OF THE CONTRADICTIONS IN A PROPER FORUM
THE UNITED STATES WILL BE FOUND ALREADY TO HAVE PAID THE PROPER PARTY,
WE DO NOT FEEL JUSTIFIED IN DISTURBING OUR SETTLEMENT. SEE LONGWILL V
UNITED STATES, 17 CT. CL. 288 (1881); AND CHARLES V UNITED STATES, 19
CT. CL. 316 (1884). AS WAS SAID IN THE LONGWILL CASE, AT PAGE 291, IT
IS THE DUTY OF THE ACCOUNTING OFFICES TO REJECT THOSE CLAIMS "AS TO THE
VALIDITY OF WHICH THEY ARE IN DOUBT."
WE BELIEVE THAT ANY ADJUSTMENT AS BETWEEN YOUR COMPANY AND D.A.D.
LEASING WOULD BE A MATTER FOR SETTLEMENT BETWEEN YOU, SINCE THE
GOVERNMENT DOES NOT HAVE ANY LEGAL OBLIGATION TO DISTRIBUTE MONIES
APPARENTLY PROPERLY PAID TO A CARRIER WHICH PARTICIPATED IN THE
TRANSPORTATION SERVICES FURNISHED THE UNITED STATES.
THE SETTLEMENT OF DECEMBER 29, 1970, IS ACCORDINGLY AFFIRMED.
B-171945, MAY 10, 1971
BID PROTEST - SUBCONTRACT
DECISION DENYING PROTEST AGAINST THE AWARD OF A SUBCONTRACT BY EG &
G, INC., AS PRIME CONTRACTOR FOR THE ATOMIC ENERGY COMMISSION, TO ORION
FOR DEVELOPMENT OF AN ADVANCED MAGNETIC TAPE RECORDER.
BECAUSE ORION HAD THE TECHNICAL ABILITY AND CREDIT TO PERFORM THE
COMP. GEN. CANNOT CONCLUDE THAT AN AWARD TO PROTESTANT AT A HIGHER PRICE
WOULD HAVE BEEN JUSTIFIED. ALSO, THERE IS NO EVIDENCE THAT THE PRIME
CONTRACTOR'S AWARD PROCEDURE WAS PREJUDICIAL TO PROTESTANT. THEREFORE,
THE PROTEST IS DENIED.
TO BORG-WARNER CONTROLS
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 12, 1971, WHICH WAS
FORWARDED TO OUR OFFICE, PROTESTING AGAINST THE AWARD OF A SUBCONTRACT
FOR THE DEVELOPMENT OF AN ADVANCED MAGNETIC TAPE RECORDER AND HARDWARE
BY EG & G, INCORPORATED, A PRIME CONTRACTOR FOR THE ATOMIC ENERGY
COMMISSION (AEC).
BASICALLY IT IS YOUR CONTENTION THAT IN VIEW OF THE HIGH RISK
POTENTIAL OF THE EQUIPMENT INVOLVED, THE MOST RELIABLE PRODUCER RATHER
THAN THE LOW PRICE SHOULD HAVE BEEN THE CRITERION FOR AWARD. YOU ALSO
URGE THAT THE FINANCIAL CONDITION OF THE SUCCESSFUL OFFEROR IS
QUESTIONABLE AND THAT EG & G'S AWARD PROCEDURE WAS PREJUDICIAL TO YOUR
CONCERN.
THE AEC'S NEVADA OPERATIONS OFFICE, BY LETTER OF MARCH 5, 1971, GAVE
THOROUGH CONSIDERATION TO THE PROCUREMENT IN LIGHT OF YOUR COMPLAINT.
WE BELIEVE THAT THE LETTER PROVIDES A COMPLETE RESPONSE TO YOUR PROTEST.
IN VIEW OF THE DETERMINATION THAT ORION HAD THE TECHNICAL ABILITY AND
CREDIT TO PERFORM, WE DO NOT THINK AN AWARD TO YOUR CONCERN AT A HIGHER
PRICE WOULD HAVE BEEN JUSTIFIED IN THE CIRCUMSTANCES OF THIS CASE. SEE
B-169148, OCTOBER 6, 1970. WE HAVE FOUND NO EVIDENCE THAT EG & G'S
AWARD PROCEDURE WAS PREJUDICIAL TO YOUR CONCERN.
IN THE CIRCUMSTANCES YOUR PROTEST IS DENIED.
B-171952, MAY 10, 1971
BID PROTEST - BID RESPONSIVENESS - BID QUALIFICATION
DECISION DENYING PROTEST BY LOW BIDDER AGAINST AWARD OF CONTRACT TO
ANY OTHER FIRM UNDER AN IFB ISSUED BY THE ARMY MISSILE COMMAND, REDSTONE
ARSENAL, ALABAMA FOR TWELVE EACH, TANK, COOLANT, FLUID.
ALTHOUGH PROTESTANT'S BID WAS LOW AT $1,512.10 EACH, THE BID WAS
QUALIFIED BY THE STATEMENT, "NOTE: QUANTITIES LESS THAN THOSE REFLECTED
WILL NOT BE ACCEPTED UNTIL REPRICING IS NEGOTIATED." BECAUSE THE
SOLICITATION WAS REDUCED TO SIX UNITS, THE CONTRACTING OFFICER PROPERLY
DETERMINED THE BID TO BE NONRESPONSIVE TO THE REQUIREMENTS OF THE
SOLICITATION AS AMENDED AND BECAUSE THIS WAS A FORMALLY ADVERTISED
PROCUREMENT THE CONTRACTING OFFICER WAS PRECLUDED FROM NEGOTIATING ANY
ADJUSTMENT OF THE UNIT PRICE FOR THE LESSER QUANTITY. THE PROTEST IS
THEREFORE DENIED.
TO WESTHOLT MANUFACTURING, INCORPORATED:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 17, 1971, AND
SUPPLEMENTAL LETTERS DATED FEBRUARY 27, 1971 AND MARCH 2, 1971, WITH
ENCLOSURES, PROTESTING AGAINST AWARD OF A CONTRACT TO ANY OTHER FIRM
UNDER INVITATION FOR BIDS NO. DAAH01-71-B-0390, ISSUED BY THE UNITED
STATES ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALABAMA.
THE INVITATION ISSUED JANUARY 5, 1971, REQUESTED BIDS FOR TWELVE (12)
EACH TANK, COOLANT, FLUID, AS SPECIFIED. BIDS WERE OPENED ON JANUARY
22, 1971, AND YOUR BID AT $1,512.10 EACH WAS LOW. HOWEVER, YOU ADDED
THE FOLLOWING NOTE TO YOUR BID SCHEDULE: "NOTE: QUANTITIES LESS THAN
THOSE REFLECTED WILL NOT BE ACCEPTED UNTIL REPRICING IS NEGOTIATED."
SUBSEQUENT TO BID OPENING THE CONTRACTING OFFICER RECEIVED NOTICE FROM
THE REQUIRING ACTIVITY REDUCING THE QUANTITY FROM 12 UNITS TO 6 UNITS.
THE CONTRACTING OFFICER, CONSIDERED YOUR QUALIFICATION TO BE, IN EFFECT,
AN "ALL OR NONE" BID AND THEREFORE NONRESPONSIVE TO THE REQUIREMENTS OF
THE SOLICITATION AS REDUCED.
YOU STATE THAT YOU WERE NOT NOTIFIED OF THE QUANTITY REDUCTION AND
THAT BEING THE LOW BIDDER ON A QUANTITY OF 12 UNITS YOU QUESTION WHY YOU
WERE NOT GIVEN AN OPPORTUNITY TO NEGOTIATE A PRICE FOR THE REDUCED
QUANTITY OF 6 UNITS.
PARAGRAPH 10(C) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS
PROVIDES AS FOLLOWS:
"(C) THE GOVERNMENT MAY ACCEPT ANY ITEM OR GROUP OF ITEMS OF ANY
OFFER, UNLESS THE OFFEROR QUALIFIES HIS OFFER BY SPECIFIC LIMITATIONS."
UNLESS OTHERWISE PROVIDED IN THE SCHEDULE, OFFERS MAY BE SUBMITTED
FOR ANY QUANTITIES LESS THAN THOSE SPECIFIED; AND THE GOVERNMENT
RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN
THE QUANTITY OFFERED AT THE UNIT PRICES OFFERED UNLESS THE OFFEROR
SPECIFIES OTHERWISE IN HIS OFFER. WHEN THE CONTRACTING AGENCY CONCLUDED
THAT THERE WAS ACTUAL NEED FOR ONLY 6 UNITS YOUR BID, BEING QUALIFIED AS
MENTIONED ABOVE, NO LONGER CONSTITUTED A RESPONSIVE BID. SINCE THIS WAS
A FORMALLY ADVERTISED PROCUREMENT, THE CONTRACTING OFFICER WAS PRECLUDED
FROM NEGOTIATING ANY ADJUSTMENT OF YOUR UNIT PRICE FOR THE LESSER
QUANTITY. SEE 49 COMP. GEN. 499 (1970).
ACCORDINGLY, WE CONCLUDE THAT THE REJECTION OF YOUR BID WAS PROPER.
THEREFORE, YOUR PROTEST MUST BE DENIED.
B-171849, MAY 7, 1971
BID PROTEST - SOLE SOURCE PROCUREMENT
DECISION DENYING PROTEST AGAINST AWARD OF CONTRACT TO AMERICAN AERO
ENGINEERING CORPORATION BY ROCK ISLAND ARSENAL, ILLINOIS FOR 23 HIGH
PRESSURE WATER CLEANERS PROCURED ON A SOLE SOURCE BASIS.
BECAUSE OF THE URGENCY OF THE REQUIREMENT AND SINCE THE DELIVERY
SCHEDULE DID NOT PERMIT DELAY INCIDENT TO ISSUANCE OF A WRITTEN
SOLICITATION OR TESTING OF PROTESTANT'S PRODUCT FOR THE INTENDED
APPLICATION OF THE REQUIREMENT, THE COMP. GEN. HOLDS THAT COMPETITION
MAY BE RESTRICTED TO A SINGLE SOURCE OF SUPPLY.
TO TRITAN CORPORATION
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 2, 1971, REGARDING THE
PROCUREMENT OF 23 HIGH PRESSURE WATER CLEANERS BY THE DEPARTMENT OF THE
ARMY, ROCK ISLAND ARSENAL, ROCK ISLAND, ILLINOIS.
YOU ADVISE THAT YOUR FIRM IS AN APPROVED SOURCE FOR THE ITEMS IN
QUESTION, HAVING FURNISHED TWO SUCH UNITS TO THE ARSENAL UNDER A PRIOR
CONTRACT ON WHICH YOUR ITEMS WERE CONSIDERED EQUAL TO THE "WATER
BLASTER" MODEL MANUFACTURED BY AMERICAN AERO ENGINEERING CORPORATION.
YOUR LETTER THEREFORE REGISTERS YOUR CONSTERNATION WITH THE FAILURE OF
THE ARSENAL TO PROVIDE YOU WITH AN OPPORTUNITY TO OFFER A PRICE ON THE
PROCUREMENT. ACCORDINGLY, AND IN VIEW OF YOUR DECLARED INABILITY TO
OBTAIN INFORMATION CONCERNING THE PROCUREMENT FROM THE LOCAL DCASO
OFFICE IN HOUSTON, YOU HAVE REQUESTED AN EXPLANATION AS TO THE REASON
YOUR FIRM WAS NOT EXTENDED AN OPPORTUNITY TO QUOTE.
THE HISTORY OF THE PROCUREMENT REVEALS THAT THE ROCK ISLAND ARSENAL
RECEIVED A PROCUREMENT/WORK DIRECTIVE (PRON) ON OCTOBER 27, 1970,
IMPOSING A PROCUREMENT REQUIREMENT ON THE ARSENAL FOR 23 HIGH PRESSURE
WATER CLEANERS, AND CITING AMERICAN WATER BLASTER COMPANY AS THE SOURCE.
THE PRON REQUIRED DELIVERY OF 12 OF THE WATER CLEANERS ON DECEMBER 15,
1970, AND 11 MORE ON DECEMBER 31, 1970. UPON RECEIPT OF THE PRON, WHICH
WAS ASSIGNED AN 02 ISSUE PRIORITY DESIGNATOR, THE ARSENAL INITIATED
PROCEDURES TO PROCURE THE WATER CLEANERS ON A SOLE SOURCE BASIS. BY
MEMORANDUM DATED OCTOBER 28, 1970, THE CHIEF OF THE PROCUREMENT DIVISION
AT ROCK ISLAND ISSUED AUTHORIZATION FOR THIS METHOD OF PROCUREMENT
PREDICATED UPON THE URGENCY OF THE REQUIREMENT, SINCE THE DELIVERY
SCHEDULE STIPULATED BY THE PRON DID NOT PERMIT THE DELAY INCIDENT TO
ISSUANCE OF A WRITTEN SOLICITATION. ACCORDINGLY, ON OCTOBER 28, 1970,
ORAL NEGOTIATIONS WERE CONDUCTED WITH AMERICAN POWERSTAGE, DIVISION OF
AMERICAN AERO ENGINEERING CORPORATION (AMERICAN), FOR 23 WATER CLEANERS.
ON OCTOBER 30, 1970, THE ROCK ISLAND ARSENAL SUBMITTED TO
HEADQUARTERS, U.S. ARMY WEAPONS COMMAND A "REQUEST FOR LETTER CONTRACT
APPROVAL," EXPLAINING THAT THE NECESSITY FOR THIS METHOD OF PROCUREMENT
WAS PREDICATED UPON A CRITICAL SUPPLY POSITION OF THE ITEM AT THAT TIME,
AND THAT THE RETROGRADE OF EQUIPMENT AND TROOPS FROM VIETNAM REQUIRED
DELIVERY OF THE WATER CLEANERS AT THE EARLIEST POSSIBLE DATE. THE
ARSENAL ALSO EXPLAINED THAT EMPLOYMENT OF THE PROPOSED LETTER CONTRACT
WOULD PERMIT SHIPMENT OF 4 OF THE WATER CLEANERS BY NOVEMBER 13, 1970,
THUS RELIEVING, TO SOME EXTENT, THE CRITICAL STATUS OF THE SUPPLY
POSITION, WHEREAS FAILURE TO UTILIZE A LETTER CONTRACT WOULD RESULT IN
FURTHER SLIPPAGE IN THE SUPPLY POSITION OF THIS ITEM, WHICH WOULD BE
HIGHLY DELETERIOUS TO CURRENT MILITARY OPERATIONS IN SOUTHEAST ASIA.
APPROVAL FOR THE USE OF A LETTER CONTRACT WAS GRANTED BY
HEADQUARTERS, U.S. ARMY WEAPONS COMMAND BY CORRESPONDENCE DATED OCTOBER
30, 1970. SUBSEQUENTLY, THE ROCK ISLAND ARSENAL BOARD OF AWARDS WAS
CONVENED FOR THE PURPOSE OF REVIEWING THE PROPOSED AWARD TO AMERICAN
AERO ENGINEERING CORPORATION. APPROVAL WAS GRANTED ONLY AFTER AN
ANALYSIS OF THE EXPLANATION OFFERED IN SUPPORT OF SOLICITING ONLY
AMERICAN, WHICH INCLUDED THE INFORMATION THAT TWO OF YOUR WATER CLEANERS
HAD PREVIOUSLY BEEN PROCURED AS AN EQUAL TO THE AMERICAN WATER BLASTER
MODEL, BUT THOSE UNITS WERE FOR AN ENTIRELY DIFFERENT APPLICATION AND
HAD NEVER BEEN DEPLOYED OR FIELD TESTED FOR THE INTENDED APPLICATION OF
THE PRESENT PROCUREMENT. FURTHER, THE URGENCY WAS CONSIDERED SUCH THAT
TIME WOULD NOT PERMIT TESTING OF THE TRITAN UNIT FOR THIS PARTICULAR
PURPOSE. ADDITIONALLY, THE SIX PREVIOUSLY PROCURED AMERICAN WATER
BLASTERS HAD BEEN DEPLOYED IN THE VIETNAMESE AMPHITHEATRE FOR THE STATED
APPLICATION, HAD BEEN SUCCESSFULLY TESTED FOR THIS APPLICATION, AND THE
RECIPIENTS OF THESE UNITS HAD BEEN PROVIDED WITH TRAINING ON OPERATIONAL
PROCEDURES, MAINTENANCE, AND TECHNICAL ASSISTANCE. IT WAS ONLY AFTER
THIS ASPECT OF THE PROBLEM WAS DISCUSSED AND REVIEWED THAT THE BOARD OF
AWARDS APPROVED AWARD OF A LETTER CONTRACT TO AMERICAN.
ON NOVEMBER 12, 1970, THE LETTER CONTRACT WAS DEFINITIZED AT A UNIT
PRICE OF $12,511.31 AND A TOTAL CONTRACT PRICE OF $310,223.91 WHICH
INCLUDED A NINE MONTHS SUPPLY OF SPARE PARTS.
OUR OFFICE HAS CONCLUDED IN THE PAST THAT COMPETITION MAY BE
RESTRICTED TO A SINGLE SOURCE OF SUPPLY IN PROCUREMENTS WHERE TIME OF
DELIVERY IS OF THE ESSENCE AND, AS SUCH, WOULD NOT PERMIT TESTING OF A
PRODUCT OFFERED BY A SOURCE OTHER THAN A SOLE SOURCE TO MEET THE
DELIVERY SCHEDULE. B-167661(1), MAY 5, 1970; B-158550, JUNE 29, 1966;
B-158705, JUNE 6, 1966; B-151310, JUNE 25, 1963.
ACCORDINGLY, SINCE TIME OF DELIVERY IN THE INSTANT PROCUREMENT
PRECLUDED TESTING OF YOUR PRODUCT FOR THE INTENDED PURPOSE, WE ARE
UNABLE TO CONCLUDE THAT THE DETERMINATION TO SOLICIT AMERICAN AS A SOLE
SOURCE WAS IMPROPER.
YOU ALSO CONTEND THAT YOU WERE ORALLY CONTACTED IN EARLY OCTOBER 1970
BY MRS. WEMPE OF THE ROCK ISLAND ARSENAL AND DIRECTED TO PREPARE A PRICE
FOR A QUANTITY OF THE WATER BLASTERS, SINCE YOU WERE TO BE PHONED WITHIN
TWO WEEKS TO STATE A PRICE, HOWEVER, YOU WERE NEVER SO CONTACTED.
A POSSIBLE CLARIFICATION OF THIS MATTER IS PROVIDED BY A STATEMENT IN
THE RECORD FROM MRS. WEMPE REVEALING THAT IN EARLY OCTOBER SHE WAS
INSTRUCTED TO CALL YOU AND AMERICAN TO INQUIRE ABOUT POSSIBLE DELIVERY
SCHEDULES FOR WATER BLASTERS SHOULD A RUSH PROCUREMENT DEVELOP. YOU
WERE ALSO REQUESTED TO FORWARD A DESCRIPTIVE CATALOG, A STANDARD
PRACTICE WHICH DOES NOT VIOLATE THE PROCUREMENT REGULATIONS. IT IS HER
POSITION THAT SHE DID NOT STATE THAT A REQUIREMENT EXISTED, NOR DID SHE
MAKE ANY PROMISE CONCERNING A PROPOSED GOVERNMENT PROCUREMENT. THAT
CALL WAS FOR INFORMATIONAL PURPOSES ONLY. IN VIEW OF THE FACT THAT THE
PRON WAS NOT RECEIVED UNTIL OCTOBER 27, WHEREAS THE CONVERSATION IN
QUESTION OCCURRED IN EARLY OCTOBER, WE ARE INCLINED TO ACCEPT THE
FOREGOING EXPLANATION.
YOU ALSO CONTEND THAT YOU WERE UNABLE TO OBTAIN INFORMATION
CONCERNING THE AWARD OF THE IMMEDIATE PROCUREMENT EITHER FROM THE ROCK
ISLAND ARSENAL OR THE LOCAL DCASO OFFICE IN HOUSTON.
WE ARE ADVISED THAT AN EXTENSIVE INVESTIGATION AT ROCK ISLAND ARSENAL
CONDUCTED BY LEGAL COUNSEL FROM HEADQUARTERS, AMC, HAS FAILED TO
DISCLOSE ANY KNOWN INSTANCE WHEREIN YOU MADE INQUIRY CONCERNING THE
SUBJECT CONTRACT AND WERE REFUSED INFORMATION. WHILE IT IS ACKNOWLEDGED
THAT TELEPHONE CONVERSATIONS WERE CONDUCTED BETWEEN ROCK ISLAND
PERSONNEL AND YOUR REPRESENTATIVES, SUCH CONVERSATIONS DID NOT RELATE TO
REQUESTS FOR INFORMATION CONCERNING THE AWARD OF THE CONTRACT TO
AMERICAN AERO ENGINEERING CORPORATION. ADDITIONALLY, AN INQUIRY
SUBMITTED TO DCASO, HOUSTON, DID DISCLOSE THAT YOUR MR. GRONAUER
DISCUSSED THIS SPECIFIC PROCUREMENT WITH THAT ACTIVITY'S QUALITY
ASSURANCE REPRESENTATIVE (QAR). HOWEVER, SINCE THIS WAS A ROCK ISLAND
PROCUREMENT, AND SINCE THE QAR POSSESSED NO CONTRACT FILE OR DETAILED
KNOWLEDGE OF THE PROCUREMENT, HE ADVISED THAT HE DECLINED TO DISCUSS THE
MATTER WITH YOUR REPRESENTATIVE. THE ARSENAL ADVISES THAT NO OTHER
INSTANCE WHICH MIGHT BE INTERPRETED AS A REFUSAL TO PROVIDE INFORMATION
COULD BE IDENTIFIED.
IN VIEW OF THE FOREGOING, AND SINCE THE CONTRACT AWARDED TO AMERICAN
PROVIDED FOR DELIVERY OF THE FINAL UNITS MORE THAN A MONTH BEFORE YOUR
PROTEST WAS FILED IN THIS OFFICE, WE SEE NO ALTERNATIVE TO DENIAL OF
YOUR PROTEST. WE HAVE, HOWEVER, ADVISED THE DEPARTMENT OF THE ARMY TO
TAKE ALL NECESSARY ACTION TO ASSURE THAT FUTURE PROCUREMENTS OF THESE
ITEMS WILL BE ACCOMPLISHED ON A COMPETITIVE BASIS.
B-171852, MAY 7, 1971
BID PROTEST - BIDDER RESPONSIBILITY
DECISION DENYING PROTEST BY KINETIC SYSTEMS, INC., AGAINST AWARD OF A
CONTRACT TO ANY OTHER BIDDER.
WHERE THE CONTRACTING OFFICER DETERMINED PROTESTANT TO BE
NONRESPONSIBLE AND THE SBA DECLINED TO ISSUE A CERTIFICATE OF
COMPETENCY, WHICH IS PERSUASIVE ON THE QUESTION OF PROTESTANT'S CAPACITY
AND CREDIT, THE COMP. GEN. CANNOT CONCLUDE THAT PROTESTANT WAS A
RESPONSIBLE BIDDER. THEREFORE, THE PROTEST IS DENIED.
TO KINETIC SYSTEMS, INC.
REFERENCE IS MADE TO YOUR LETTER OF MARCH 5, 1971, AND PRIOR
CORRESPONDENCE, PROTESTING AGAINST THE AWARD OF A CONTRACT TO A BIDDER
OTHER THAN YOUR FIRM UNDER INVITATION FOR BIDS (IFB) NO.
DACA87-71-B-0020.
THE BASIS FOR THE PROTEST IS THAT AWARD MUST BE MADE TO KINETIC
SYSTEMS, INC. (KSI) AS THE LOW RESPONSIVE, RESPONSIBLE BIDDER. THE
CONTRACTING OFFICER, ON THE BASIS OF A NEGATIVE PREAWARD SURVEY,
DETERMINED KSI TO BE NONRESPONSIBLE AND THE SMALL BUSINESS
ADMINISTRATION (SBA) THEREAFTER DECLINED TO ISSUE A CERTIFICATE OF
COMPETENCY (COC) TO KSI. SINCE IT DOES NOT APPEAR THAT THE CONTRACTING
OFFICER ACTED IN A MANNER WHICH WAS ARBITRARY, CAPRICIOUS, OR IN BAD
FAITH, AND SINCE THE REFUSAL OF SBA TO ISSUE A COC IS PERSUASIVE ON THE
QUESTION OF A FIRM'S CAPACITY AND CREDIT, WE CANNOT CONCLUDE THAT KSI
WAS A RESPONSIBLE BIDDER FOR PURPOSES OF THIS PROCUREMENT. SEE
B-167563, B-167652, OCTOBER 13, 1969.
ACCORDINGLY, YOUR PROTEST IS DENIED.
B-172454, MAY 7, 1971
BID PROTEST - PROPRIETARY SPECIFICATIONS
DENYING PROTEST OF WAYNE MANUFACTURING CO., AGAINST THE AWARD OF A
CONTRACT UNDER AN IFB ISSUED BY USCG TRASUPCEN, GOVERNMENT ISLAND,
ALAMEDA, CALIF., FOR A ROTARY, SELF-PROPELLED SWEEPER TO G.H. TENANT
COMPANY, SOLE BIDDER.
THE REQUIREMENT THAT THE SWEEPER BE PLUMBED FOR A SCRUBBER, TENNANT
BEING THE SOLE MANUFACTURER OF THE SCRUBBING ATTACHMENT, REFLECTS THE
LEGITIMATE NEEDS OF THE GOVERNMENT AND WILL EFFECTUATE A SAVINGS IN THAT
A SEPARATE SCRUBBING UNIT NEED NOT BE PURCHASED. TO SO DESIGN THE
PROCUREMENT IS WITHIN THE AUTHORITY OF THE CONTRACTING AGENCY.
TO WAYNE MANUFACTURING CO.
REFERENCE IS MADE TO A COPY OF YOUR LETTER OF MARCH 30, 1971,
PROTESTING AGAINST THE AWARD OF A CONTRACT UNDER INVITATION FOR BIDS
(IFB) NO. 31-1088-71, ISSUED BY THE SUPPLY OFFICER, USCG TRASUPCEN,
GOVERNMENT ISLAND, ALAMEDA, CALIFORNIA.
THE IFB WAS ISSUED MARCH 16, 1971, SOLICITING BIDS FOR ONE "FSN
3825-806-8184, SWEEPER, ROTARY, SELF-PROPELLED (STREET TYPE) IN
ACCORDANCE WITH FEDERAL SPECIFICATION NUMBER 00-S-870C, DTD 20 OCT 70
AND SPECIFIC REQUIREMENTS LISTED BELOW IN COMPLIANCE WITH PARAGRAPH 6.2
OF ABOVE SPECIFICATION *** TYPE 1, SIZE 42." PARAGRAPH 6.2 OF FEDERAL
SPECIFICATION NO. 00-S-870C, ORDERING DATA, PROVIDES, "PURCHASERS
SHOULD SELECT THE PREFERRED OPTIONS PERMITTED HEREIN AND INCLUDE THE
FOLLOWING INFORMATION IN PROCUREMENT DOCUMENTS." THERE THEN FOLLOWS A
LIST OF PERMISSIBLE OPTIONS FOR THE SWEEPER. THE IFB REFERENCED ITEM
(T) OF THIS PARAGRAPH WHICH READS: "WHEN SCRUBBER ASSEMBLY IS REQUIRED
(SEE 3.12)." PARAGRAPH 3.12, SCRUBBER OPERATION, OF THE CITED
SPECIFICATION PROVIDES THAT "WHEN SPECIFIED (SEE 6.2.1), SIZES 42 AND 48
SWEEPERS SHALL BE EQUIPPED TO OPERATE AS AN AUTOMATIC SCRUBBER-VACUUM
UNIT WITH AN ATTACHMENT ASSEMBLY." HOWEVER, IN REFERENCING ITEM (T), THE
IFB STATED: "MUST BE PLUMBED FOR SCRUBBER TO BE PURCHASED AT LATER
DATE."
WHILE THE WAYNE MANUFACTURING CO., BUEHRER, INC., AND G. H. TENNANT
COMPANY WERE SOLICITED, ONLY TENNANT SUBMITTED A BID IN THE AMOUNT OF
$4,224.
WAYNE PROTESTS THE USE OF THE CITED SPECIFICATION AS PROPRIETARY, AND
POINTS OUT THE DISCREPANCY BETWEEN THE LANGUAGE USED IN OPTION (T) OF
THE IFB AND THAT USED IN PARAGRAPH 3.12 OF THE SPECIFICATION. WE HAVE
BEEN ADVISED THAT AWARD HAS BEEN POSTPONED PENDING RESOLUTION OF THE
PROTEST. SPECIFICALLY, WAYNE PROTESTS THAT THE PHRASEOLOGY EMPLOYED IN
THE IFB DOES NOT CONFORM TO THE CITED FEDERAL SPECIFICATION AND THAT THE
SPECIFICATION AUTHORIZES PURCHASE OF A SCRUBBER ATTACHMENT OPTION, NOT
PLUMBING FOR A SCRUBBER TO BE PURCHASED AT A LATER DATE. UPON REVIEW,
WE BELIEVE THAT THE SPECIFICATION AS ADVERTISED PERMITS THE PROCUREMENT
OF A SWEEPER PLUMBED FOR A SCRUBBER. SPECIFICATION PARAGRAPH 3.12
PROVIDES THAT "SWEEPERS SHALL BE EQUIPPED TO OPERATE AS AN AUTOMATIC
SCRUBBER-VACUUM UNIT WITH AN ATTACHMENT ASSEMBLY." WHILE THE LANGUAGE
UTILIZED BY THE COAST GUARD IS NOT IDENTICAL TO PARAGRAPH 6.2(T) OF THE
FEDERAL SPECIFICATIONS, THE IMPORT IS SUBSTANTIALLY THE SAME SINCE THERE
IS LITTLE DIFFERENCE BETWEEN THE PHRASE "MUST BE PLUMBED" AND THE
ABOVE-UNDERSCORED LANGUAGE. WE ARE ADVISED THAT SINCE TENNANT IS THE
SOLE MANUFACTURER OF THE SCRUBBING ATTACHMENT, THE SWEEPER UNIT MUST BE
SPECIALLY FITTED WITH AN EXTRA HYDRAULIC ASSEMBLY, OR BE PLUMBED, TO
INCORPORATE THE SCRUBBER UNIT. THUS, TO BE EQUIPPED TO OPERATE ALSO AS
A SWEEPER-SCRUBBER, THE SWEEPER UNIT MUST BE PLUMBED.
OUR OFFICE HAS CONSISTENTLY HELD THAT THE DRAFTING OF SPECIFICATIONS
TO REFLECT THE MINIMUM NEEDS OF THE GOVERNMENT IS PRIMARILY THE
RESPONSIBILITY OF THE CONTRACTING AGENCY. 36 COMP. GEN. 251, 252
(1956). OUR OFFICE HAS BEEN INFORMED BY THE COAST GUARD THAT IT HAS A
NEED FOR A SWEEPER-SCRUBBER WHICH CAN SWEEP 687,000 SQUARE FEET AND
SCRUB 180,000 SQUARE FEET; THAT THE PURCHASE PRICE OF A SEPARATE
SCRUBBING MACHINE WOULD BE APPROXIMATELY TWICE THAT OF A SCRUBBING
ATTACHMENT; AND THAT THE MOST EFFECTIVE COST APPROACH ENTAILS PURCHASE
OF THE SCRUBBER UNIT. HOWEVER, DUE TO BUDGETARY CONSIDERATIONS, THE
COAST GUARD HAS BEEN LIMITED TO PROCURING A PART OF THE TOTAL NEED UNTIL
FURTHER APPROPRIATIONS ARE AVAILABLE. WHILE THE MINIMUM REQUIREMENT
REMAINS THE SWEEPER PLUS SCRUBBER OPTION, WE DO NOT FIND THE ACTUAL
PROCUREMENT OBJECTIONABLE SINCE WE HAVE BEEN ADVISED THAT PURCHASE OF A
PLUMBED SWEEPER IN ANTICIPATION OF THE SCRUBBER OPTION WILL EFFECTUATE A
SAVINGS TO THE GOVERNMENT IN THAT IT IS LESS EXPENSIVE THAN LATER
SUBMITTING A STANDARD SWEEPER UNIT FOR TOTAL MODIFICATION.
THEREFORE, THE PROTEST IS DENIED.
B-163758, MAY 6, 1971
HEADNOTES-UNAVAILABLE
SUBJECT: USE OF IMPREST FUNDS TO PAY TRANSPORTATION CHARGES ON SMALL
DOMESTIC FREIGHT SHIPMENTS AND REDELEGATION OF AUTHORITY TO APPROVE USE
OF COMMERCIAL PAPER
TO THE HEADS OF DEPARTMENTS, INDEPENDENT ESTABLISHMENTS, AND OTHERS
CONCERNED:
THE GENERAL ACCOUNTING OFFICE CONCURS IN THE JOINT AGENCY
TRANSPORTATION STUDY RECOMMENDATIONS THAT DEPARTMENTS, AGENCIES, AND
OTHER ESTABLISHMENTS OF THE U. S. GOVERNMENT BE AUTHORIZED TO USE
IMPREST FUNDS FOR THE PAYMENT OF TRANSPORTATION CHARGES NOT EXCEEDING
$25 ON DOMESTIC FREIGHT SHIPMENTS MOVED ON COMMERCIAL BILLS OF LADING
AND THAT HEADS OF DEPARTMENTS, AGENCIES, AND OTHER ESTABLISHMENTS BE
PERMITTED TO REDELEGATE THEIR DISCRETIONARY AUTHORITY TO APPROVE THE USE
OF COMMERCIAL FORMS AND PROCEDURES FOR SUCH SHIPMENTS.
BACKGROUND
IN FEBRUARY 1969, DISCRETIONARY AUTHORITY WAS GRANTED TO THE HEAD OF
A DEPARTMENT, AGENCY, OR OTHER ESTABLISHMENT OF THE U. S. GOVERNMENT TO
APPROVE, WHERE HE DETERMINED IT MORE EFFICIENT AND ECONOMICAL, THE USE
OF COMMERCIAL FORMS AND PROCEDURES, RATHER THAN GOVERNMENT BILL OF
LADING FORMS AND PROCEDURES, IN PROCURING TRANSPORTATION FOR PARTICULAR
TYPES OF SMALL SHIPMENTS. THIS AUTHORITY WAS SUBJECT TO CERTAIN
RESTRICTIONS, THE MAJOR ONE BEING THAT THE TRANSPORTATION CHARGES
ORDINARILY NOT EXCEED $25 PER SHIPMENT.
THIS USE OF COMMERCIAL PAPER ON SMALL SHIPMENTS STIMULATED AN
INTEREST IN SIMPLIFYING PROCEDURES FOR PAYING THE RELATED TRANSPORTATION
CHARGES. INTERESTED AGENCIES HANDLED A LARGE NUMBER OF SMALL SHIPMENTS
WITH FREIGHT CHARGES GENERALLY UNDER $25 AND IN MOST INSTANCES IN SUCH
SMALL DOLLAR AMOUNTS THAT IT APPEARED UNECONOMICAL TO FOLLOW ESTABLISHED
BILLING AND PAYMENT PROCEDURES.
ADVANTAGES OF CASH PAYMENT
THE CASH PAYMENT OF TRANSPORTATION CHARGES FOR SMALL SHIPMENTS IS A
NATURAL EXTENSION OF THE USE OF COMMERCIAL FORMS AND PROCEDURES. THE
USE OF CASH SHOULD MATERIALLY REDUCE THE PAPER WORK OF BOTH THE
GOVERNMENT AND THE CARRIER INDUSTRY SINCE THERE WOULD BE NO NEED FOR THE
PREPARATION OF GOVERNMENT BILL OF LADING FORMS OR THE PUBLIC VOUCHER FOR
TRANSPORTATION CHARGES; THE DETAILED PROCESSING OF CARRIER VOUCHERS FOR
PAYMENT; AND THE ISSUANCE AND MAILING OF CHECKS.
APPLICATION OF PROCEDURES
DEPARTMENTS, AGENCIES, AND OTHER ESTABLISHMENTS THAT UTILIZE THE
ABOVE-CITED AUTHORITY TO APPROVE THE USE OF COMMERCIAL PAPER ON SMALL
SHIPMENTS HAVING TRANSPORTATION CHARGES NOT EXCEEDING $25 ARE HEREBY
AUTHORIZED TO MAKE PAYMENT OF THOSE CHARGES FROM IMPREST FUNDS. THESE
PAYMENTS SHALL BE BASED ON THE USE OF THE COMMERCIAL FORMS AND
PROCEDURES CURRENTLY PRESCRIBED IN 5 GAO 3017 AND SUBJECT TO THE
FOLLOWING FURTHER LIMITATIONS.
1. ADOPTION OF THE CASH PAYMENT PROCEDURE SHALL BE OPTIONAL WITH THE
DEPARTMENT, AGENCY, OR ESTABLISHMENT AND MUST BE CONCURRED IN BY THE
CARRIER INVOLVED.
2. IMPREST FUNDS SHALL NOT BE USED TO PAY FOR INTERNATIONAL
SHIPMENTS AND FOR HOUSEHOLD GOODS VAN SHIPMENTS.
3. PAYMENT OF FREIGHT CHARGES PRIOR TO PERFORMANCE OF THE SERVICE IS
PROHIBITED UNDER CURRENT LEGISLATION. HOWEVER, IF LEGISLATION IS
ENACTED, AS RECOMMENDED BY THE JOINT AGENCY TRANSPORTATION STUDY, TO
EXEMPT TRANSPORTATION PAYMENTS FROM THE SCOPE OF THE STATUTE PROHIBITING
ADVANCE PAYMENT (31 U. S. C. 529), THE GENERAL ACCOUNTING OFFICE WILL
CIRCULARIZE INSTRUCTIONS COVERING THE AUTHORITY TO PREPAY FREIGHT
CHARGES FOR SMALL SHIPMENTS.
4. THE IMPREST FUND DISBURSEMENTS FOR TRANSPORTATION SPECIFIED
HEREIN SHALL GENERALLY BE MADE IN ACCORDANCE WITH THE PROVISIONS OF 7
GAO 27.
IN ADDITION, AUTHORITY IS GRANTED TO THE HEAD OF A DEPARTMENT,
AGENCY, OR OTHER ESTABLISHMENT TO REDELEGATE TO SUCH OFFICIAL OR
OFFICIALS AS HE MAY DESIGNATE WITHIN HIS ORGANIZATION THE AUTHORITY TO
APPROVE THE USE, WHERE DETERMINED MORE EFFICIENT AND ECONOMICAL, OF
COMMERCIAL FORMS AND PROCEDURES FOR SMALL FREIGHT SHIPMENTS ON WHICH THE
TRANSPORTATION CHARGES DO NOT EXCEED $25. THE REDELEGATED AUTHORITY
ALSO SHALL BE SUBJECT TO THE LIMITATIONS AND PROCEDURES CURRENTLY STATED
IN 5 GAO 3017.
THIS REDELEGATION OF AUTHORITY SHOULD RELIEVE AGENCY HEADS AND
INTERVENING LAYERS OF THE PAPER WORK BURDEN INVOLVED IN APPROVING THIS
USE OF COMMERCIAL PAPER AND PLACE THE DECISIONMAKING AUTHORITY CLOSER TO
THE SHIPPING ACTIVITIES WHERE THE BENEFITS AND ECONOMIES INHERENT IN THE
USE OF SUCH FORMS AND PROCEDURES ARE MOST APPARENT.
B-169633, MAY 6, 1971
BID PROTEST - REOPENING NEGOTIATIONS - AMBIGUOUS SPECIFICATIONS
AFFIRMING PRIOR DECISION WHICH CONFIRMED AN ADMINISTRATIVE
RECOMMENDATION TO REOPEN NEGOTIATIONS UNDER AN RFP ISSUED BY ARMY
MATERIEL COMMAND FOR DESIGN OF A MULTIPLEX ANALOG SYSTEM AND DENYING
PROTEST OF VIDAR CORPORATION AGAINST THE ACTION.
A STATEMENT IN THE RFP SPECIFYING, "NO CHANGES ARE AUTHORIZED TO BE
MADE TO THE REQUIREMENTS OF THIS SOLICITATION. IN THE EVENT THE OFFEROR
DOES NOT INTEND TO MEET ALL THE SPECIFICATIONS HEREIN SET FORTH OR
SUBMITS ALTERNATE SOLICITATIONS, A FULLY DETAILED DESCRIPTION SHALL BE
FURNISHED SETTING FORTH HIS INTENT," IS AMBIGUOUS ON ITS FACE. IT CAN
REASONABLY BE CONSTRUED AS A DIRECTION FOR COMPLIANCE AND AS INVITING
SPECIFICALLY DETAILED DEVIATIONS FROM THE SPECIFICATIONS. THEREFORE,
VIDAR'S CONTENTION THAT THE DEVIATIONS IN ITS PROPOSAL WERE MINOR IS NOT
DISPOSITIVE OF THE MATTER BECAUSE THE AMBIGUOUS LANGUAGE MAY WELL HAVE
CAUSED ANOTHER BIDDER TO THINK MODIFICATIONS WERE NOT PERMITTED AND ALL
OFFERORS MAY NOT HAVE HAD AN EQUITABLE OPPORTUNITY TO HAVE THEIR
PROPOSALS CONSIDERED ON A SIMILAR BASIS.
TO MR. SECRETARY:
REFERENCE IS MADE TO LETTER AMCGC-P DATED DECEMBER 7, 1970, WITH
ENCLOSURES, FROM THE DEPUTY GENERAL COUNSEL, HEADQUARTERS ARMY MATERIEL
COMMAND (AMC), REPORTING ON THE REQUEST OF VIDAR CORPORATION'S COUNSEL
FOR RECONSIDERATION OF DECISION B-169633, AUGUST 20, 1970, 50 COMP. GEN.
___, WHICH AGREED WITH THE ADMINISTRATIVE RECOMMENDATION TO REOPEN
NEGOTIATIONS UNDER REQUEST FOR PROPOSALS (RFP) NO. DAAA21-70-R-0207.
FOR THE REASONS STATED BELOW, IT IS OUR VIEW THAT THE CIRCUMSTANCES
DICTATE A REOPENING OF THE NEGOTIATIONS.
THE DECEMBER 7 LETTER ADVISES THAT THE PRIOR ADMINISTRATIVE
RECOMMENDATION HAS BEEN RECONSIDERED AND, IF OUR OFFICE AGREES THAT THE
SPECIFICATION DEVIATIONS IN ALL PROPOSALS ARE MINOR AND MAY BE WAIVED,
AMC PROPOSES NOT TO REOPEN NEGOTIATIONS AND TO MAKE AN AWARD TO THE
LOWEST OFFEROR. AS NOTED IN OUR AUGUST 20 DECISION, THE TECHNICAL
EVALUATORS DETERMINED THAT THE DEVIATIONS REMAINING IN THE FINAL
PROPOSALS ARE MINOR, INSIGNIFICANT, AND OF NO MATERIAL EFFECT ON THE
OVERALL PERFORMANCE OF THE PROPOSED SYSTEM. WE DO NOT BELIEVE THAT THE
IMMATERIALITY OF THE DEVIATIONS IN THE PROPOSALS AS REVISED IS
DISPOSITIVE OF THE MATTER.
WE NOTE THAT THE RFP CONTAINED DESIGN SPECIFICATIONS STATED IN
MANDATORY TERMS AS TO THE SUBCARRIER DISCRIMINATOR COMPONENT OF THE
MULTIPLEX ANALOG SYSTEM BEING PROCURED. FURTHER, WE NOTE THAT AMC
PROPOSES TO MAKE AWARD TO THE VIDAR CORPORATION, WHICH DEVIATED FROM THE
SUBCARRIER DISCRIMINATOR SPECIFICATIONS, ON THE BASIS THAT AMC'S
TECHNICAL EVALUATORS HAVE CONCLUDED THAT SUCH DEVIATIONS WILL NOT
MATERIALLY AFFECT THE DESIRED PERFORMANCE OF THE MULTIPLEX ANALOG
SYSTEM. WE UNDERSTAND THAT SUCH DEVIATIONS HAVE BEEN WAIVED AS MINOR
WITHOUT THE BENEFIT OF NEGOTIATIONS. HOWEVER, OUR REVIEW OF THE
NEGOTIATION RECORD INDICATES THAT THE STANDARD (OFF-THE-SHELF) ITEMS
OFFERED IN THE ORIGINAL VIDAR PROPOSAL HAD OTHER DEFICIENCIES OF A
MATERIAL NATURE WHICH WERE CORRECTED DURING NEGOTIATIONS TO COMPLY WITH
CERTAIN ASPECTS OF THE SPECIFICATIONS. IN THAT REGARD, DATA-CONTROL
SYSTEMS, INC., NOW ALLEGES THAT, IF IT KNEW THAT THE DISCRIMINATOR
SPECIFICATIONS DID NOT HAVE TO BE STRICTLY COMPLIED WITH, IT WOULD HAVE
OFFERED A DIFFERENT TYPE OF DISCRIMINATOR IN ITS TECHNICAL PROPOSAL. WE
NOTE THAT DATA-CONTROL SYSTEMS' PROPOSAL DID NOT HAVE ANY MATERIAL
DEVIATION WHICH REQUIRED CORRECTION, EXCEPT POSSIBLY IN ONE AREA
UNRELATED TO THE DISCRIMINATOR.
AT THE TOP OF PAGE 19 OF THE RFP, THE FOLLOWING STATEMENT APPEARS:
"NOTE:
"NO CHANGES ARE AUTHORIZED TO BE MADE TO THE REQUIREMENTS OF THIS
SOLICITATION. IN THE EVENT THE OFFEROR DOES NOT INTEND TO MEET ALL THE
SPECIFICATIONS HEREIN SET FORTH OR SUBMITS ALTERNATE SOLICITATIONS, A
FULLY DETAILED DESCRIPTION SHALL BE FURNISHED SETTING FORTH HIS INTENT."
ON ITS FACE, THE STATEMENT IS AMBIGUOUS AND MISLEADING. IT
REASONABLY CAN BE CONSTRUED AS A DIRECTION THAT THERE BE COMPLIANCE WITH
SPECIFICATION REQUIREMENTS AND AS INVITING SPECIFICALLY DETAILED
DEVIATIONS FROM THE SPECIFICATIONS. WE ALSO NOTE THE SPECIFICATION
REQUIRED THAT THE SYSTEM "CONSIST OF ONLY STANDARD UNITS (OFF THE
SHELF)." THESE PROVISIONS OF THE SOLICITATION MAY WELL HAVE LEFT
OFFERORS UNCERTAIN AS TO THE EXTENT TO WHICH THEIR STANDARD UNITS COULD
BE MODIFIED TO MEET THE SPECIFICATIONS AND THE EXTENT TO WHICH
DEVIATIONS FROM THE SPECIFICATIONS WOULD BE WAIVED. IN THIS REGARD, WE
NOTE THAT DATA-CONTROL SYSTEMS SPECIFICALLY RAISED A QUESTION AS TO THE
ACCEPTABILITY OF THE DISCRIMINATOR OFFERED BY VIDAR IN ITS LETTER OF
MARCH 25, 1970. DATA-CONTROL ALLEGES, AS STATED ABOVE, THAT IF IT HAD
BEEN ADVISED OF ANY RELAXATION OF THE SPECIFICATIONS, IT WOULD HAVE
OFFERED A DIFFERENT DISCRIMINATOR.
VIDAR CONTENDS INFORMALLY THAT THE DISCRIMINATOR DATA-CONTROL HAS
INDICATED IT DID NOT OFFER, BUT WOULD PROPOSE NOW, CONTAINS MAJOR
DEVIATIONS. HOWEVER, IF ONE PROPOSER IS ALLOWED TO MAKE MODIFICATIONS
TO OVERCOME MATERIAL DEFICIENCIES IN ITS STANDARD EQUIPMENT, THE SAME
OPPORTUNITY SHOULD BE GIVEN TO ALL. WE BELIEVE THE AMBIGUOUS LANGUAGE
IN THE RFP MAY WELL HAVE CAUSED DATA-CONTROL TO THINK THAT MODIFICATIONS
OF THIS NATURE WOULD NOT BE PERMITTED. IN VIEW THEREOF, IT APPEARS THAT
ALL OFFERORS MAY NOT HAVE HAD AN EQUITABLE OPPORTUNITY TO QUOTE AND HAVE
THEIR PROPOSALS CONSIDERED ON A SIMILAR BASIS.
THEREFORE, NEGOTIATIONS SHOULD BE REOPENED. AND TO INSURE THAT
EQUALITY OF COMPETITION WILL BE EXTENDED TO ALL OFFERORS, THE RFP SHOULD
BE APPROPRIATELY AMENDED, WITH WRITTEN NOTICE THEREOF TO ALL OFFERORS,
IN ACCORDANCE WITH THE REQUIREMENTS OF PARAGRAPH 3-805.1(E) OF THE ARMED
SERVICES PROCUREMENT REGULATION. SEE, IN THIS REGARD, 49 COMP. GEN.
156, 161-162 (1969).
IN THE DECEMBER 7 REPORT SOME RESERVATION WAS EXPRESSED IN REOPENING
NEGOTIATIONS SINCE A PREAWARD SURVEY WAS PERFORMED ON VIDAR. IT IS
STATED THAT ALTHOUGH PRICES HAVE NOT BEEN DISCLOSED, THE OCCURRENCE OF
THE PREAWARD SURVEY MAY TAINT THE REOPENING OF NEGOTIATIONS WITH THE
ASPECTS OF AN AUCTION. HOWEVER, IN 48 COMP. GEN. 323 (1968), AT PAGE
324, IT WAS STATED:
" *** ALTHOUGH IT IS POSSIBLE THAT THE MERE INSTITUTION OF A PREAWARD
SURVEY CAN IN A PARTICULAR CASE GIVE RISE TO THE INFERENCE THAT AN
OFFEROR'S PRICE IS NOT LOW IN RELATION TO THAT OF ANOTHER OFFEROR, WE DO
NOT BELIEVE THAT SUCH NECESSARY ACTION ON THE PART OF THE GOVERNMENT
CONSTITUTES AN AUCTION TECHNIQUE PER SE. *** "
ACCORDINGLY, WE ADHERE TO THE CONCLUSION EXPRESSED IN OUR PRIOR
DECISION.
B-172022, MAY 6, 1971
BID PROTEST - LATE PROPOSAL - DELAY IN MAILS
DENYING PROTEST OF PULASKI CABLE TELEVISION, INC., AGAINST THE
REJECTION BY THE ARMY CORPS OF ENGINEERS, KANSAS CITY, OF ITS LATE
PROPOSAL SENT IN RESPONSE TO AN RFP ISSUED FOR CONSTRUCTION OF A
COMMUNITY ANTENNA TELEVISION SYSTEM.
THE PROPOSAL FROM PULASKI WAS NOT RECEIVED IN THE MAILROOM UNTIL 8:20
A.M. JANUARY 7, (OPENING OF PROPOSALS WAS AT 2:30 P.M. JANUARY 6,) EVEN
THOUGH IT HAD BEEN SENT BY REGISTERED MAIL, SPECIAL DELIVERY FROM ROLLA,
MISSOURI ON JANUARY 5. THE STATEMENT OF THE KANSAS CITY POSTMASTER TO
THE EFFECT THAT SCHEDULING WAS SUCH THAT THERE WOULD NOT HAVE BEEN
DELIVERY BEFORE THE 2:30 P.M. DEADLINE UNDER NORMAL OPERATING
PROCEDURES IS SUFFICIENT TO PREVENT OPERATION OF CLAUSE IN THE
INVITATION WHICH ALLOWS LATE PROPOSALS TO BE CONSIDERED WHEN DELAYED IN
THE MAILS. THE FACT THAT BEFORE MAILING PULASKI WAS ADVISED BY THE
ROLLA POST OFFICE THAT ITS PROPOSAL WOULD ARRIVE ON TIME DOES NOT
CONSTITUTE A BASIS FOR CONSIDERING THE LATE PROPOSAL.
TO NORTHERN, WILLIAMS AND SMALLWOOD
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 23, 1971, WITH
ENCLOSURES, PROTESTING ON BEHALF OF PULASKI CABLE TELEVISION, INC.,
AGAINST THE REJECTION BY THE DEPARTMENT OF THE ARMY, KANSAS CITY
DISTRICT, CORPS OF ENGINEERS, OF THE CORPORATION'S LATE PROPOSAL
SUBMITTED IN RESPONSE TO INVITATION FOR PROPOSALS NO. DACA41-71-B-0007.
THE INVITATION, ISSUED NOVEMBER 2, 1970, REQUESTED PROPOSALS FOR THE
USE OF GOVERNMENT LAND AND FACILITIES CONTINGENT UPON THE CONSTRUCTION
AND OPERATION OF A COMMERCIAL COMMUNITY ANTENNA TELEVISION SYSTEM WITHIN
THE BOUNDARIES OF THE UNITED STATES ARMY TRAINING CENTER ENGINEER AND
FORT LEONARD WOOD MILITARY RESERVATION, MISSOURI. AT THE TIME SCHEDULED
FOR THE OPENING OF PROPOSALS, 2:30 P.M. ON JANUARY 6, 1971, ONLY ONE
PROPOSAL HAD BEEN RECEIVED AND OPENED. THE PROPOSAL FROM PULASKI WAS
NOT RECEIVED IN THE MAILROOM OF THE OFFICE OF THE DISTRICT ENGINEER,
KANSAS CITY DISTRICT, UNTIL 8:20 A.M. ON JANUARY 7, 1971. THE PROPOSAL
HAD BEEN SENT REGISTERED MAIL-SPECIAL DELIVERY FROM ROLLA, MISSOURI, ON
JANUARY 5, 1971.
THE INVITATION CONTAINED A CLAUSE WHICH, IN PERTINENT PART, STATED:
" *** THOSE (PROPOSALS) RECEIVED BEFORE AWARD IS MADE BUT DELAYED IN
THE MAILS BY OCCURRENCES BEYOND CONTROL OF THE OFFEROR MAY BE CONSIDERED
IF WRITTEN CERTIFICATION IS FURNISHED BY AUTHORIZED POSTAL AUTHORITIES
TO THAT EFFECT. *** "
PULASKI SUBMITTED TWO LETTERS FROM THE ASSISTANT POSTMASTER AT ROLLA,
MISSOURI. THE FIRST LETTER DATED JANUARY 8, 1971, STATED:
"THIS IS TO INFORM YOU THAT THE MAIL SCHEDULE FROM ROLLA TO KANSAS
CITY NORMALLY WOULD GIVE NEXT DAY DELIVERY FOR MAIL THAT WAS MAILED
BEFORE 5 P.M. IN ROLLA."
THE SECOND LETTER DATED FEBRUARY 23, 1971, STATED:
"IN ANSWER TO YOUR INQUIRY ABOUT MAIL SCHEDULED TO KANSAS CITY PLEASE
BE ADVISED THAT OUR SCHEDULE SHOWS THAT MAIL LEAVING HERE NOT LATER THAN
9 P.M. WOULD ARRIVE IN KANSAS CITY AT 3:20 A.M. THE NEXT MORNING BY
SURFACE MAIL.
"HOWEVER, ON THE DATE OF JANUARY 5, 1971 WE WERE SCHEDULED TO SEND
REGISTERED MAIL TO KANSAS CITY AT 4:30 P.M. THROUGH ST. LOUIS. ON THIS
DATE YOUR REGISTER WAS DISPATCHED IN A POUCH LABELED ST. LOUIS DIS AND
ACCORDING TO SCHEDULE WAS DUE TO ARRIVE AT THE ST. LOUIS TRUCK TERMINAL
AT 7:30 P.M. WE DO NOT KNOW THE SCHEDULE FROM THE TRUCK TERMINAL ON TO
THE DESTINATION. SINCE IT DID NOT ARRIVE AT KANSAS CITY FOR DELIVERY
THE NEXT DAY, IT APPEARS THERE WAS A MISHANDLING OR DELAY EN ROUTE."
HOWEVER, BY LETTER DATED JANUARY 18, 1971, THE POSTMASTER AT KANSAS
CITY, MISSOURI, ADVISED THE CORPS OF ENGINEERS AS FOLLOWS:
"WE HAVE CHECKED THE HANDLING OF REGISTERED LETTER #14861, MAILED BY
MR. DONALD MAGGI, BOX 549, ROLLA, MISSOURI.
"THIS LETTER WAS RECEIVED AT THE ROLLA POST OFFICE ON JANUARY 5,
1971, AND DISPATCHED TO ST. LOUIS, MISSOURI, AT 4:30 PM ON JANUARY 5.
THE POUCH WAS SCHEDULED TO ARRIVE AT THE ST. LOUIS TRUCK TERMINAL AT
7:30 PM ON THAT DATE.
"RECORDS INDICATE THE ITEM WAS RE-BILLED TO KANSAS CITY BY THE
REGISTRY SECTION AT THE ST. LOUIS, MISSOURI, POST OFFICE AT 5:15 AM ON
JANUARY 6. IT WAS THEN SCHEDULED FOR DISPATCH TO KANSAS CITY VIA AIRLIFT
ON FLIGHT 23, SCHEDULED TO ARRIVE AT KANSAS CITY AT 11:47 AM ON JANUARY
6. HOWEVER, FLIGHT 23 WAS ANNULLED AND THE REGISTERED POUCH ARRIVED AT
KANSAS CITY VIA TWA SHORTLY AFTER NOON ON JANUARY 6. THE POUCH ACTUALLY
ARRIVED AT OUR REGISTRY SECTION AT 2:20 PM ON JANUARY 6.
"AS THE SCHEDULED REGISTERED DISPATCH FROM ST. LOUIS, MISSOURI, IS ON
FLIGHT 23, EVEN IF THE POUCH HAD ARRIVED AT KANSAS CITY AS SCHEDULED AT
11:47 AM, IT WOULD HAVE BEEN IMPOSSIBLE FOR THIS PARTICULAR LETTER TO
HAVE REACHED OUR REGISTRY SECTION AND BEEN DIRECTED TO THE SPECIAL
DELIVERY SECTION IN TIME TO HAVE MADE DELIVERY BEFORE 2:30 PM ON JANUARY
6. THE EARLIEST POSSIBLE DELIVERY WOULD HAVE BEEN ON THE LATE AFTERNOON
TRIP LEAVING THE GENERAL POST OFFICE AT 3:30 PM. THE DELAYED ARRIVAL IN
KANSAS CITY ELIMINATED ANY POSSIBILITY OF PROCESSING AND DELIVERY DURING
THE BUSINESS HOURS ON JANUARY 6, 1971.
"BASED ON INFORMATION SUPPLIED BY THE POSTMASTER AT ROLLA, MISSOURI,
AND PROCESSING GIVEN REGISTERED MAIL, WE SEE NO WAY IN WHICH THE LETTER
COULD HAVE ARRIVED IN KANSAS CITY AND BEEN DELIVERED PRIOR TO YOUR 2:30
PM OPENING TIME. WE ARE AT A LOSS AS TO WHY THE SENDER WAS TOLD THAT
THE LETTER WOULD REACH YOUR OFFICE BY YOUR OPENING TIME, IN VIEW OF THE
DISPATCH AND ROUTING THAT HAVE BEEN ESTABLISHED."
ALTHOUGH THE ROLLA ASSISTANT POSTMASTER CONCLUDED THAT IT "APPEARS"
THAT THERE HAD BEEN MISHANDLING BY THE POST OFFICE, THE CONCLUSION IS
NOT SUPPORTED BY A COMPLETE MAIL ROUTING. ON THE OTHER HAND, THE KANSAS
CITY POSTMASTER TRACED THE ROUTING FROM BEGINNING TO END AND INDICATED
THAT THE ONLY DELAY WAS THE CANCELLATION OF FLIGHT 23. THE KANSAS CITY
POSTMASTER FURTHER STATED THAT EVEN IF THE FLIGHT HAD NOT BEEN DELAYED,
THE SCHEDULING WAS SUCH THAT THERE WOULD NOT HAVE BEEN A DELIVERY BEFORE
THE 2:30 P.M. OPENING TIME. IN THE CIRCUMSTANCES, THERE HAS BEEN
DEMONSTRATED SOMETHING LESS THAN THE REQUIRED WRITTEN CERTIFICATION THAT
THE FAILURE OF THE PULASKI PROPOSAL TO ARRIVE TIMELY WAS THE RESULT OF
AN OCCURRENCE IN THE MAIL WHICH UNDULY DELAYED TRANSMISSION.
THE FACT THAT BEFORE MAILING THE PROPOSAL A PULASKI REPRESENTATIVE
MAY HAVE BEEN ADVISED BY THE ROLLA POST OFFICE THAT IT SHOULD ARRIVE ON
TIME AND THAT PULASKI MAY HAVE RELIED UPON SUCH ADVICE DOES NOT
CONSTITUTE A BASIS FOR CONSIDERING THE LATE PROPOSAL. B-141156,
NOVEMBER 12, 1959. FURTHER, THE FACT THAT PULASKI HAS RECEIVED ORDINARY
MAIL FROM THE CORPS OF ENGINEERS IN KANSAS CITY IN LESS TIME THAN THE
AMOUNT OF TIME THAT PULASKI PROVIDED FOR THE DELIVERY OF THE PROPOSAL IS
OF NO SIGNIFICANCE SINCE CONSTRUCTIVE DELIVERY DEPENDS ON THE MAIL
SCHEDULE TO THE CONTRACTING OFFICE OF THE CORPS OF ENGINEERS, NOT FROM
THE CORPS OF ENGINEERS. MOREOVER, THE FACT THAT IT MIGHT HAVE BEEN
SUPPOSED THAT THE CLASS OF MAIL EMPLOYED WOULD RESULT IN QUICKER
DELIVERY THAN ORDINARY MAIL IS NOT CONTROLLING. WHILE THE TYPE OF MAIL
SELECTED MAY NOT BE AS FAST AS MIGHT BE EXPECTED, NO BASIS EXISTS FOR
PROVIDING AN EXCEPTION TO THE REQUIREMENT FOR TIMELY SUBMISSION OF
PROPOSALS. 49 COMP. GEN. 191 (1969).
ACCORDINGLY, THE PROTEST IS DENIED.
B-170098, MAY 5, 1971
MILITARY PERSONNEL - MILITARY RETIRED PAY - REEMPLOYMENT IN THE CIVIL
SERVICE
ADVISING WITH RESPECT TO HIS ENTITLEMENT TO MILITARY RETIRED PAY UPON
REEMPLOYMENT IN A CIVIL SERVICE POSITION, THAT COL. JOHN P. SHEFFEY MAY
BE ENTITLED TO FULL PAY.
ON THE ASSUMPTION THAT THE TERMINATION OF COL. SHEFFEY'S CIVILIAN
EMPLOYMENT DID NOT INVOLVE AN AUTOMATIC SEPARATION, IF HE SHOULD BECOME
EMPLOYED IN A POSITION SUBJECT TO THE CIVIL SERVICE RETIREMENT SYSTEM,
HE WOULD CEASE TO BE A CIVIL SERVICE ANNUITANT AND WOULD RESUME THE
STATUS OF A CIVIL SERVICE EMPLOYEE HE HAD IMMEDIATELY PRIOR TO HIS
INVOLUNTARY RETIREMENT. THE WAIVER OF HIS RETIRED PAY WOULD NO LONGER
BE EFFECTIVE. THUS, HE WOULD BE ENTITLED TO THE FULL PAY OF THE POSITION
AND TO HIS MILITARY RETIRED PAY REDUCED IN ACCORDANCE WITH THE PROVISION
OF 5 U.S.C. 5532.
TO HONORABLE ROBERT B. ANDERSON:
THIS REFERS TO YOUR LETTER DATED APRIL 12, 1971, ENCLOSING A COPY OF
LETTER DATED APRIL 5, 1971, FROM COLONEL JOHN P. SHEFFEY, III, USA,
RETIRED, TO THE ADJUTANT GENERAL, DEPARTMENT OF THE ARMY, INVOLVING HIS
ENTITLEMENT TO MILITARY RETIRED PAY UPON REEMPLOYMENT IN A CIVIL SERVICE
POSITION.
WE UNDERSTAND THAT COLONEL SHEFFEY SERVED MORE THAN 5 YEARS AS
EXECUTIVE DIRECTOR, ATLANTIC-PACIFIC INTEROCEANIC CANAL STUDY
COMMISSION, UNTIL ITS TERMINATION ON DECEMBER 1, 1970; THAT HE THEN
WAIVED HIS ARMY RETIRED PAY IN ORDER TO QUALIFY FOR A CIVIL SERVICE
ANNUITY BASED ON AN INVOLUNTARY SEPARATION; THAT HE HAS BEEN REEMPLOYED
ON A CONSULTANT BASIS; AND THAT HE IS CONTEMPLATING ACCEPTING
REEMPLOYMENT IN A CIVIL SERVICE POSITION. SINCE THE COUNTING OF HIS
MILITARY SERVICE WAS NECESSARY TO ESTABLISH HIS ELIGIBILITY FOR A CIVIL
SERVICE ANNUITY, THE QUESTION HAS ARISEN AS TO WHETHER HE MAY WITHDRAW
HIS WAIVER OF MILITARY RETIRED PAY AND HAVE SUCH PAY REINSTATED IN VIEW
OF OUR HOLDING IN OUR DECISION B-170098, AUGUST 11, 1970, 50 COMP. GEN.
___, COPY HEREWITH.
IN OUR DECISION B-147639, JANUARY 16, 1962, 41 COMP. GEN. 460, COPY
HEREWITH, WE HELD THAT A FORMER MEMBER OF CONGRESS IS NOT ENTITLED TO
RECEIVE MILITARY RETIRED PAY IN ADDITION TO A CIVIL SERVICE ANNUITY
WHERE HIS MILITARY SERVICE WAS USED TO ESTABLISH HIS ELIGIBILITY FOR THE
ANNUITY. IN LINE WITH THAT RULING, WE HELD IN OUR DECISION B-168650,
MARCH 11, 1970, 49 COMP. GEN. 581, COPY HEREWITH, THAT A REEMPLOYED
ANNUITANT WHOSE MILITARY SERVICE HAD BEEN USED TO QUALIFY HIM FOR A
CIVIL SERVICE RETIREMENT COULD NOT REVOKE HIS WAIVER OF MILITARY RETIRED
PAY AND AGAIN BECOME ENTITLED TO MILITARY RETIRED PAY. THAT DECISION
WAS PREDICATED ON THE FACT THAT THE ANNUITANT INVOLVED WAS SUBJECT TO
THE PROVISIONS OF 5 U.S.C. 8344(A) WHICH REQUIRED - WITH CERTAIN
EXCEPTIONS NOT APPLICABLE IN THAT CASE - THAT IF HE SHOULD BE REEMPLOYED
IN THE CIVIL SERVICE, HIS ANNUITY BE CONTINUED AND THAT HE SHOULD BE
PAID ADDITIONALLY ONLY THE DIFFERENCE BETWEEN SUCH ANNUITY AND HIS
SALARY.
IN OUR DECISION B-170098, AUGUST 11, 1970, WE HELD THAT IF MILITARY
SERVICE IS NOT USED TO ESTABLISH ELIGIBILITY FOR A CIVIL SERVICE ANNUITY
BUT SUCH SERVICE IS USED ONLY IN THE COMPUTATION OF THE ANNUITY TO
INCREASE THE AMOUNT THEREOF, WAIVER OF RETIRED PAY MAY BE WITHDRAWN, THE
CIVIL SERVICE ANNUITY REDUCED, AND RETIRED PAY REINSTATED.
WHILE THE JURISDICTION TO FINALLY DETERMINE THE RIGHTS OF AN EMPLOYEE
TO A CIVIL SERVICE ANNUITY IS VESTED IN THE UNITED STATES CIVIL SERVICE
COMMISSION, WE POINT OUT THAT ONE OF THE EXCEPTIONS MENTIONED IN 5
U.S.C. 8344(A) - CONTAINED IN SUBSECTION (A)(2) - RELATES TO AN
ANNUITANT WHOSE ANNUITY IS BASED ON AN "INVOLUNTARY SEPARATION FROM THE
SERVICE OTHER THAN AN AUTOMATIC SEPARATION." IF, AS APPEARS, COLONEL
SHEFFEY'S RETIREMENT WAS THE RESULT OF HIS BEING INVOLUNTARILY SEPARATED
FROM HIS EMPLOYMENT WITH THE CANAL STUDY COMMISSION ON DECEMBER 1, 1970,
AND SUCH SEPARATION WAS NOT AUTOMATIC, THE PROVISIONS OF 5 U.S.C.
8344(A) WOULD NOT APPEAR TO BE APPLICABLE IF HE SHOULD ACCEPT PERMANENT
EMPLOYMENT IN A CIVIL SERVICE POSITION.
SECTION S15-6 OF SUBCHAPTER S15, FEDERAL PERSONNEL MANUAL SUPPLEMENT
831-1, RELATING TO REEMPLOYMENT OF ANNUITANTS WHOSE RETIREMENT WAS BASED
ON INVOLUNTARY SEPARATION, PROVIDES IN PERTINENT PART AS FOLLOWS:
"A. MEANING OF INVOLUNTARY SEPARATION. AN ANNUITANT IS CONSIDERED
AS HAVING BEEN RETIRED BASED ON AN INVOLUNTARY SEPARATION IF THE
SEPARATION MEETS THE DEFINITION OF THAT TERM CONTAINED IN SECTION S11-2,
EXCEPT THAT A SEPARATION FOR AGE RETIREMENT IS NOT AN INVOLUNTARY
SEPARATION FOR REEMPLOYMENT PURPOSES.
"B. IF REEMPLOYMENT IS SUBJECT TO THE RETIREMENT SYSTEM. REGARDLESS
OF HIS AGE, IF THE ANNUITANT IS REEMPLOYED ON OR AFTER OCTOBER 1, 1956:
"(1) ANNUITY IS TERMINATED AT THE END OF THE DAY PRIOR TO THE
REEMPLOYMENT;
"(2) THE EMPLOYING AGENCY WITHHOLDS THE REGULAR 7 PERCENT RETIREMENT
DEDUCTIONS FROM HIS PAY; AND
"(3) FUTURE ANNUITY RIGHTS ARE DETERMINED UNDER THE LAW IN EFFECT AT
THE TIME OF SEPARATION FROM REEMPLOYMENT."
ON THE ASSUMPTION THAT THE TERMINATION OF COLONEL SHEFFEY'S CIVILIAN
EMPLOYMENT ON DECEMBER 1, 1970, DID NOT INVOLVE AN AUTOMATIC SEPARATION,
IT IS OUR VIEW THAT IF HE SHOULD BECOME EMPLOYED IN A POSITION SUBJECT
TO THE CIVIL SERVICE RETIREMENT SYSTEM, HE WOULD CEASE TO BE A CIVIL
SERVICE ANNUITANT AND WOULD RESUME THE STATUS OF A CIVIL SERVICE
EMPLOYEE HE HAD IMMEDIATELY PRIOR TO HIS INVOLUNTARY RETIREMENT. THE
WAIVER OF HIS RETIRED PAY WOULD NO LONGER BE EFFECTIVE. THUS, HE WOULD
BE ENTITLED TO THE FULL PAY OF THE POSITION AND TO HIS MILITARY RETIRED
PAY REDUCED IN ACCORDANCE WITH THE PROVISIONS OF 5 U.S.C. 5532.
B-170698, MAY 4, 1971
BID PROTEST - PATENT INFRINGEMENT - REMEDIES
DENYING PROTEST OF LOE INDUSTRIES AGAINST THE FAILURE TO CANCEL AN
IFB ISSUED BY THE NAVAL SUPPLY SYSTEMS COMMAND, AVIATION SUPPLY OFFICE,
PHILADELPHIA PENN., FOR HYDRAULIC FILL SERVICE UNITS BECAUSE IT DID NOT
INCLUDE A PATENT INDEMNITY CLAUSE AND DID NOT PROVIDE A PARTIAL SMALL
BUSINESS SET-ASIDE AND AGAINST AWARD TO SUN ELECTRIC CORPORATION, LOW
BIDDER.
WHILE THE IFB DID NOT CONTAIN A PATENT INDEMNITY CLAUSE, SUN (THE
SUCCESSFUL BIDDER) STATED THAT IT WOULD ACCEPT A CONTRACT WITH THAT
CLAUSE AT NO INCREASE IN COST TO THE GOVERNMENT. THE COMP. GEN. FINDS
NO LEGAL OBJECTION TO THE ACCEPTANCE OF THIS GUARANTEE, IT BEING IN BEST
INTERESTS OF THE GOVERNMENT. BUT EVEN IF THE CONTRACT AWARDED SUN DID
NOT CONTAIN A PATENT INDEMNITY CLAUSE, THE POSSIBILITY OF GOVERNMENT
LIABILITY FOR PATENT INFRINGEMENT WOULD NOT REQUIRE THAT THE CONTRACT BE
CANCELLED (B-158790, APRIL 15, 1966).
LOE CONTENDS THAT INFRINGEMENT OF ITS PATENTS WILL OCCUR IF ANY OTHER
BIDDER PRODUCES THE DESIRED UNITS IN ACCORDANCE WITH IFB SPECIFICATIONS
AND THAT UNDER SUCH CIRCUMSTANCES THE COMP. GEN. SHOULD NOT FOLLOW 46
COMP. GEN. 205 (1966) WHEREIN 28 U.S.C. 1498 WAS INTERPRETED TO BE AN
EMINENT DOMAIN STATUTE WHICH VESTS IN THE GOVERNMENT THE RIGHT TO USE
ANY PATENT UPON PAYMENT OF REASONABLE COMPENSATION. THE FACT THAT IN NO
OTHER CASES HAS THE PATENT HOLDER'S DATA BEEN USED AS SPECIFICATIONS FOR
THE PROCUREMENT IS NOT PERSUASIVE OF THE POSITION THAT 46 COMP. GEN.,
SUPRA, IS NOT FOR APPLICATION HERE. MOREOVER, THE COMP. GEN. IS IN NO
POSITION TO MAKE SUSTANTIVE DETERMINATION CONCERNING POSSIBLE PATENT
VIOLATIONS.
TO MR. ROBERT B. BOWYTZ:
WE REFER TO YOUR LETTER DATED DECEMBER 14, 1970, AND PRIOR
CORRESPONDENCE, ON BEHALF OF LOE INDUSTRIES (LOE), REQUESTING THAT
INVITATION FOR BIDS (IFB) NO. N00383-71-B-0118, ISSUED BY THE NAVAL
SUPPLY SYSTEMS COMMAND, AVIATION SUPPLY OFFICE (ASO), PHILADELPHIA,
PENNSYLVANIA, BE CANCELED PRINCIPALLY BECAUSE IT WAS NOT TOTALLY SET
ASIDE FOR SMALL BUSINESS AND BECAUSE IT DID NOT INCLUDE A PATENT
INDEMNITY CLAUSE. FOR THE REASONS DISCUSSED BELOW, WE FIND NO LEGAL
BASES TO FAVORABLY CONSIDER YOUR REQUEST.
THE IFB, ISSUED AUGUST 3, 1970, WITH A SCHEDULED BID OPENING DATE OF
AUGUST 18, 1970, SOLICITED BIDS ON AN UNRESTRICTED BASIS FOR 800 EACH
HYDRAULIC FILL SERVICE UNITS TO BE MANUFACTURED IN ACCORDANCE WITH NAVAL
AIR SYSTEMS COMMAND (NAVAIR) SPECIFICATION XAS-1832, REV. "A," JULY 7,
1969, ENTITLED "FLUID SERVICE UNIT, HYDRAULIC, HAND PUMP OPERATED, SELF
CONTAINED, LIGHTWEIGHT," AS WELL AS THREE SEPARATE LINE ITEMS OF DATA:
ENGINEERING DRAWINGS AND ASSOCIATED DATA, TECHNICAL MANUALS, AND
PROVISIONING DATA. ASO HAD ORIGINALLY INTENDED TO PURCHASE 1,075 UNITS;
HOWEVER, THE PROCURING ACTIVITY CONTRACTED WITH LOE ON A SOLE-SOURCE
BASIS UNDER THE PUBLIC EXIGENCY AUTHORITY OF 10 U.S.C. 2304(A)(2) FOR
275 UNITS ON AUGUST 6, 1970. MODIFICATION 0001 OF AUGUST 14, 1970, TO
THE IFB EXTENDED THE BID OPENING DATE TO AUGUST 25, 1970, AND LENGTHENED
THE DELIVERY SCHEDULE. BIDS WERE OPENED ON AUGUST 25, 1970, AND WERE
ABSTRACTED AS FOLLOWS:
UNIT
PRICE TOTAL
SUN ELECTRIC CORP. (LARGE BUSINESS) $319.54 $256,177
BENDIX CORP. (LARGE BUSINESS) 340.00 273,600
HENRY SPEN & CO., INC. (SMALL BUSINESS) 335.00 275,750
LOE INDUSTRIES (SMALL BUSINESS) 356.43 288,619
(ALTERNATE BID) 354.12 284,046
ON AUGUST 27, 1970, YOU PROTESTED TO OUR OFFICE. BY LETTER DATED
SEPTEMBER 4, 1970, ASO WAS ADVISED BY THE PATENT ATTORNEYS FOR LOE THAT
THE "MANUFACTURE, SALE OR USE OF HYDRAULIC FLUID HANDLING APPARATUS
HAVING FEATURES SET FORTH IN THE MILITARY SPECIFICATION XAS-1832 REV. A,
DATED JULY 7, 1969 *** WITH RESPECT TO WHICH WE UNDERSTAND BIDS WERE
SUBMITTED (UNDER THE IFB) *** CONSTITUTES AN INFRINGEMENT OF U.S. PATENT
NO. 3,385,475, ISSUED TO WALLACE D. LOE ON MAY 28, 1968 AND ASSIGNED TO
OUR CLIENT, LOE INDUSTRIES." IN ADDITION, THE LETTER NOTIFIED ASO THAT
LOE "HAS RETAINED FULL PROPRIETARY RIGHTS IN ITS DESIGN DATA,
MANUFACTURING DRAWINGS, INCLUDING MICROFILMS OF THE SAME, PREVIOUSLY
FURNISHED BY OUR CLIENT TO THE UNITED STATES GOVERNMENT." PURSUANT TO
THE PROVISIONS OF PARAGRAPH 2-407.8(B)(3) OF THE ARMED SERVICES
PROCUREMENT REGULATION (ASPR), THE CONTRACTING OFFICER DETERMINED THAT
THE ITEMS TO BE PROCURED WERE URGENTLY REQUIRED AND RECEIVED APPROVAL TO
MAKE AN AWARD PRIOR TO THE RESOLUTION OF THE PROTEST. ON FEBRUARY 22,
1971, A CONTRACT UNDER THE IFB, WHICH CONTAINED AN AUTHORIZATION AND
CONSENT CLAUSE, WAS AWARDED TO SUN FOR 800 UNITS.
ONE OF THE PRINCIPAL BASES FOR YOUR PROTEST IS THAT "THE PROCUREMENT
WAS IMPROPERLY NOT SET ASIDE 100% FOR SMALL BUSINESS." HOWEVER, WE MUST
REJECT THIS BASIS OF PROTEST. SECTION 15 OF THE SMALL BUSINESS ACT, 15
U.S.C. 644, PROVIDES THAT THE DETERMINATION AS TO WHETHER A PARTICULAR
PROCUREMENT, OR PART THEREOF, SHOULD BE SET ASIDE FOR SMALL BUSINESS IS
WITHIN THE JURISDICTION OF THE PROCURING ACTIVITY AND THE SMALL BUSINESS
ADMINISTRATION. WE HAVE HELD THAT ABSENT A CLEAR SHOWING OF ABUSE OF
DISCRETION, THE ADMINISTRATIVE DETERMINATION AS TO WHETHER A PROCUREMENT
SHOULD BE SET ASIDE FOR SMALL BUSINESS WILL NOT BE DISTURBED. SEE
B-170837, MARCH 8, 1971.
YOU REFER TO A PREVIOUS SOLICITATION (IFB NO. N00383-69-B-1125), FOR
IDENTICAL ITEMS, WHERE, IT IS ALLEGED, SEVERAL SMALL BUSINESS CONCERNS
PARTICIPATED. IT IS REPORTED THAT FIVE BIDDERS RESPONDED TO IFB -1125,
A NON-SET-ASIDE FOR 283 UNITS, AS FOLLOWS:
UNIT PRICE
LOE INDUSTRIES (SMALL BUSINESS) $351.12
AUTO-CONTROL LABS. DIV. OF RUCKER CO.
(LARGE BUSINESS) 395.00
BENDIX CORP. (LARGE BUSINESS) 518.55
LIQUIDONICS, INC. (LARGE BUSINESS) 728.00
ALTON IRON WORKS, INC. (SMALL BUSINESS) 939.00
IN VIEW OF THE FACT THAT LOE, THE ONE SMALL BUSINESS BIDDER,
SUBMITTED A BID AT A REASONABLE PRICE, WHICH WAS ACCEPTED, WHILE THE
OTHER SMALL BUSINESS BIDDER QUOTED AN UNREASONABLE PRICE ALMOST THREE
TIMES THAT OF THE EVENTUAL AWARD PRICE TO LOE, THE CONTRACTING OFFICER,
WITH THE CONCURRENCE OF THE SMALL BUSINESS SPECIALIST, DID NOT RECOMMEND
THAT THE INSTANT PROCUREMENT BE SET ASIDE FOR THE EXCLUSIVE
PARTICIPATION OF SMALL BUSINESS CONCERNS. IN THIS REGARD, ASPR
1-706.5(A)(1) REQUIRES THAT THE ENTIRE AMOUNT OF A PROCUREMENT SHALL BE
SET ASIDE FOR EXCLUSIVE SMALL BUSINESS PARTICIPATION IF THE CONTRACTING
OFFICER DETERMINES THAT THERE IS REASONABLE EXPECTATION THAT BIDS WILL
BE OBTAINED FROM A SUFFICIENT NUMBER OF RESPONSIBLE SMALL BUSINESS
CONCERNS SO THAT AWARDS WILL BE MADE AT REASONABLE PRICES. SEE, ALSO,
PARAGRAPH 1-706.5 OF THE NAVY PROCUREMENT DIRECTIVES. WE ATTACH NO
PARTICULAR SIGNIFICANCE TO THE FACT THAT THE RESULTS OF THE BIDDING ON
THE INSTANT IFB DISCLOSED THAT TWO SMALL BUSINESS CONCERNS SUBMITTED
BIDS AT APPARENTLY REASONABLE PRICES. SUCH A RESULT IS NOT DETERMINATIVE
OF THE QUESTION AS TO WHETHER THERE WAS AT THE TIME OF ISSUING THE
INVITATION A REASONABLE EXPECTATION OF SUFFICIENT COMPETITION FROM SMALL
BUSINESS CONCERNS. SEE B-157581, NOVEMBER 22, 1965. IN LIGHT OF THE
PROCUREMENT HISTORY OF THIS ITEM, THE ADMINISTRATIVE DETERMINATION NOT
TO SET ASIDE THE PROCUREMENT FOR SMALL BUSINESS CONCERNS WAS NOT AN
ABUSE OF DISCRETION.
IN THE ALTERNATIVE, YOU URGE THAT THE PROCUREMENT QUALIFIED FOR A
PARTIAL SMALL BUSINESS SET-ASIDE UNDER ASPR 1-706.6, WHICH PERMITS A
PORTION OF A PROCUREMENT TO BE SET ASIDE FOR EXCLUSIVE SMALL BUSINESS
PARTICIPATION WHERE, INTER ALIA, THE PROCUREMENT IS SEVERABLE INTO TWO
OR MORE ECONOMIC PRODUCTION RUNS OR REASONABLE LOTS. ON JUNE 24, 1970,
THE SMALL BUSINESS SPECIALIST, PRIOR TO THE SOLE-SOURCE BUY OF 275 UNITS
FROM LOE, RECOMMENDED THAT THE PROCUREMENT BE EFFECTED AS A 50-PERCENT
SMALL BUSINESS SET-ASIDE FOR 537 UNITS OF THE TOTAL QUANTITY OF 1,075,
CITING THE PRIOR CONTRACT FOR 283 UNITS AWARDED TO LOE. THE CONTRACTING
OFFICER REJECTED THE SMALL BUSINESS SPECIALIST'S RECOMMENDATION STATING
THAT THE PROCUREMENT WAS NOT SUSCEPTIBLE OF A SEVERANCE INTO TWO
ECONOMIC PRODUCTION RUNS FOR FOUR REASONS: (1) THE REDUCTION IN
QUANTITY FROM 1,075 TO 800; (2) THE FACT THAT THE SPECIFICATIONS ARE OF
THE PERFORMANCE TYPE NECESSITATING ADDITIONAL DESIGN AND ENGINEERING
COSTS; (3) THE FACT THAT THE THREE SEPARATE LINE ITEMS OF DATA WOULD
HAVE TO BE PROCURED FROM BOTH THE "SET-ASIDE" AND "NON-SET-ASIDE"
CONTRACT, RESULTING IN A DUPLICATION OF COSTS; AND (4) THE INCREASED
COSTS OF ADMINISTRATIVE SUPPORT INVOLVED IN ANY SET-ASIDE PROCUREMENT.
THE SMALL BUSINESS SPECIALIST ACCEPTED THE CONTRACTING OFFICER'S
BASES OF REJECTION OF HIS ORIGINAL RECOMMENDATION.
YOU HAVE RESPONDED TO THE CONTRACTING OFFICER'S POSITION AS FOLLOWS:
"THE ONLY PREREQUISITE THAT THE CONTRACTING OFFICER MENTIONED FOR THE
ESTABLISHMENT OF THE PARTIAL SET-ASIDE THAT IS RECOGNIZED BY ASPR
(1-706.6(A)) IS THE ABILITY TO SEVER THE PROCUREMENT INTO ECONOMIC
PRODUCTION RUNS, AS WAS DISCUSSED ABOVE UNDER PARAGRAPH (A);
DUPLICATION OF EFFORT AND INCREASED COST OF SUPPORT ARE NOT PROPERLY
BEFORE THE CONTRACTING OFFICER IN MAKING HIS SET-ASIDE DECISION. YET,
IN PARAGRAPH 11 OF THE CONTRACTING OFFICER'S STATEMENT HE ADMITS THAT
ONE OF THE THREE REASONS FOR DENIAL OF THE SMALL BUSINESS SPECIALIST'S
RECOMMENDATION FOR A PARTIAL SET-ASIDE WAS THE DUPLICATION IN THE
PROCUREMENT OF DATA ITEMS; HE REITERATES THIS RATIONALE AT PARAGRAPH 13
OF HIS STATEMENT. BECAUSE THE CONTRACTING OFFICER SERIOUSLY ERRED IN
HIS DETERMINATION THAT THE PROCUREMENT COULD NOT BE SPLIT INTO TWO
ECONOMIC PRODUCTION RUNS, A DECISION WHICH RAN COUNTER TO THE EVIDENCE
HE HAD AVAILABLE, AND BECAUSE THE CONTRACTING OFFICER USED AS ONE OF THE
BASES OF HIS DECISION A MATTER WHICH WAS NOT PROPERLY CONSIDERED
(DUPLICATION OF PROCUREMENT OF DATA) THE PROTESTANT RESPECTFULLY URGES
THAT THE DECISION BE REVERSED BY CANCELLATION OF THE SOLICITATION." IN
THE ABOVE REGARD, WE NOTE THAT ASPR 1-706.6(A)(II) REFERS TO ASPR
1-804.1(A)(2) WHICH SETS FORTH FACTORS TO BE CONSIDERED IN THE
DETERMINATION OF WHETHER A PROPOSED PROCUREMENT IS SUSCEPTIBLE OF
DIVISION INTO TWO OR MORE ECONOMIC PRODUCTION RUNS AS FOLLOWS:
"(2) IN DETERMINING WHETHER A PROPOSED PROCUREMENT IS SUSCEPTIBLE TO
DIVISION INTO TWO OR MORE ECONOMIC PRODUCTION RUNS OR REASONABLE LOTS,
CONSIDERATION SHOULD BE GIVEN TO THE FOLLOWING FACTORS AND ANY OTHERS
DEEMED APPROPRIATE:
(I) PRICE AND PROCUREMENT HISTORY OF THE ITEMS,
(II) OPEN INDUSTRY CAPACITY,
(III) STARTUP COST INCLUDING SPECIAL TOOLING
REQUIREMENTS,
(IV) DELIVERY SCHEDULE, AND
(V) NATURE OF ITEM AND QUANTITY BEING PROCURED." WE DO NOT AGREE THAT
THE CONTRACTING OFFICER PLACED RELIANCE ON IMPROPER FACTORS IN NOT
RECOMMENDING A PARTIAL SMALL BUSINESS SET-ASIDE FOR THIS PROCUREMENT IN
VIEW OF THE BROAD LANGUAGE OF THE ABOVE-CITED REGULATION. THEREFORE, WE
FIND NO LEGAL BASIS UPON WHICH TO DISTURB THE DETERMINATION BY THE
CONTRACTING OFFICER AND THE SMALL BUSINESS SPECIALIST NOT TO SET ASIDE A
PORTION OF THE PROCUREMENT FOR EXCLUSIVE SMALL BUSINESS PARTICIPATION.
THE OTHER BASIS FOR THE PROTEST IS THAT THERE IS A PATENT AMBIGUITY
BETWEEN THE DELIVERY SCHEDULE AND THE REQUIRED QUANTITY OF UNITS. IN
LENGTHENING THE DELIVERY SCHEDULE, MODIFICATION 0001 PROVIDED FOR THE
DELIVERY OF 850 UNITS, INCLUDING 150 IN THE LAST MONTH OF THE PROPOSED
CONTRACT, IN CONFLICT WITH THE BASIC SCHEDULE WHICH CALLED FOR A
QUANTITY OF 800 UNITS. A REVIEW OF THE BIDS OF LOE AND SUN REVEALS
THAT, IN THE WORDS OF THE CONTRACTING OFFICER, "ALL BIDDERS BID ON A
QUANTITY OF 800, AS IS EVIDENT FROM THE EXTENSION OF THEIR UNIT BID
PRICES." COMPETITION HAS NOT BEEN ADVERSELY AFFECTED IN THIS CASE SINCE
ALL BIDDERS BID ON THE BASIS INTENDED AND THUS NO BIDDER OBTAINED ANY
ADVANTAGE BECAUSE OF THE AMBIGUITY. IN SIMILAR CIRCUMSTANCES, WE HAVE
TAKEN THE POSITION THAT, RATHER THAN READVERTISE, THE AWARD SHOULD BE
PERMITTED TO STAND WITH THE OMISSION OR CORRECTION OF THE DEFECTIVE
PROVISION. SEE 43 COMP. GEN. 23, 26 (1963). CF. B-170768(1), FEBRUARY
17, 1971. WE HAVE BEEN ADVISED THAT THE CONTRACT AWARDED TO SUN
REFLECTED A MODIFICATION OF THE DELIVERY SCHEDULE TO REQUIRE THE
DELIVERY OF 100 UNITS IN THE LAST MONTH OF THE PROPOSED CONTRACT. IN
VIEW OF THE FOREGOING, WE FIND NO BASIS TO QUESTION THE AWARD OR THE
RESULTING CONTRACT.
NEXT, YOU PROTEST THAT ASO IMPROPERLY OMITTED THE PATENT INDEMNITY
CLAUSE FROM THE SOLICITATION. WHILE THE IFB DID NOT CONTAIN THE PATENT
INDEMNITY CLAUSE, BY LETTER DATED JANUARY 26, 1971, TO ASO, SUN STATED
THAT "AT NO INCREASE IN COST TO THE GOVERNMENT, (SUN) WILL ACCEPT A
CONTRACT RESULTING *** WITH THE INCLUSION OF THE PATENT INDEMNITY CLAUSE
PER ASPR 9-103.1 AND BY ADDING TO THE END OF THE CLAUSE: 'THE FOREGOING
SHALL APPLY ONLY TO THE FOLLOWING: LOE INDUSTRIES, U.S. PATENT
3,385,475, MAY 28, 1968.'" THE CONTRACT AWARDED TO SUN INCLUDED THE
PATENT INDEMNITY CLAUSE PURSUANT TO ITS JANUARY 26 LETTER. WE FIND NO
LEGAL OBJECTION TO THE ACCEPTANCE OF THIS GUARANTEE AT NO INCREASE IN
COST SINCE IT WAS IN THE BEST INTERESTS OF THE GOVERNMENT. SEE
B-158790, APRIL 15, 1966. EVEN IF THE CONTRACT AWARDED UNDER THE IFB TO
SUN DID NOT CONTAIN THE PATENT INDEMNITY CLAUSE, WE HAVE HELD THAT THIS
WOULD NOT REQUIRE OUR OFFICE TO OBJECT SOLELY BECAUSE THE GOVERNMENT
MIGHT INCUR PATENT INFRINGEMENT LIABILITY. SEE B-158790, SUPRA.
WE NEXT TURN TO YOUR CONTENTION THAT THE USE OF LOE'S PRIVATELY
DEVELOPED DATA AS THE SOURCE OF THE SPECIFICATION USED IN THE IFB WAS IN
VIOLATION OF LOE'S PROPRIETARY RIGHTS. YOU SUPPLIED OUR OFFICE WITH
EXTENSIVE DOCUMENTATION AND AFFIDAVITS TO SUPPORT YOUR CONTENTION THAT
LOE SUPPLIED ITS DATA TO NAVAIR ON A CONFIDENTIAL BASIS. NAVAIR
DISPUTES THIS CLAIM AND DIRECTS OUR ATTENTION TO THE ADMITTED FACT THAT
LOE "DID NOT STAMP THE SPECIFICATION WITH ANY PARTICULAR LEGEND" TO
RESTRICT USE OF ITS DATA FOR COMPETITIVE PROCUREMENT PURPOSES. WE NEED
NOT RESOLVE THIS CONFLICT SINCE THIS POINT OF PROTEST MAY BE RESOLVED ON
OTHER GROUNDS.
LOE'S PATENT WAS GRANTED ON MAY 28, 1968. THE INITIAL SOLICITATION
FOR THE ITEM, UNDER AN IDENTICAL SPECIFICATION, WAS ISSUED ON JUNE 17,
1969, ON A COMPETITIVE BASIS AND RESULTED IN AN AWARD TO LOE AS THE
LOWEST OF FIVE BIDDERS. THE IFB IN THAT PROCUREMENT WAS AMENDED PRIOR
TO BID OPENING ON JULY 17, 1969, AS THE RESULT OF DISCUSSIONS BETWEEN
LOE AND NAVAIR, TO INCLUDE REVISION "A" OF THE BASIC NAVAIR
SPECIFICATION XAS-1832. WITH RESPECT TO THE INSTANT PROCUREMENT, LOE
MADE NO ATTEMPT TO PROTEST THE ALLEGED IMPROPER DISCLOSURE OF ITS DATA
UNTIL IT BECAME AWARE OF THE FACT THAT IT WAS NOT LOW BIDDER. SINCE LOE
RAISED NO OBJECTIONS TO THE USE OF THE NAVAIR SPECIFICATION AS VIOLATIVE
OF ITS PROPRIETARY RIGHTS DURING THE COURSE OF TWO COMPETITIVE
PROCUREMENTS, WE CONCLUDE THAT THIS FACT, COUPLED WITH THE
ADMINISTRATIVE POSITION, AFFORDS NO BASIS TO QUESTION ASO'S ACTIONS IN
THIS REGARD. THE COURTS HAVE CONSISTENTLY TAKEN THE POSITION THAT IN
ORDER TO MAINTAIN A PROPRIETARY CLAIM TO EXCLUSIVE RIGHTS IN
INFORMATION, THE PARTY CLAIMING SUCH RIGHTS MUST TAKE REASONABLE ACTION
TO PREVENT OR SUPPRESS ANY UNAUTHORIZED USE. SEE 46 COMP. GEN. 885, 889
(1967), AND CASES CITED THEREIN; 49 ID. 124, 128 (1969); AND
B-168485(1), MARCH 30, 1970.
WE FINALLY TURN TO YOUR ALLEGATION, AS SUPPORTED BY LOE'S PATENT
ATTORNEYS, THAT INFRINGEMENT OF THE LOE PATENT WILL OCCUR IF ANY OTHER
BIDDER PRODUCES THE DESIRED UNITS IN ACCORDANCE WITH THE NAVAIR
SPECIFICATION. YOU STATE THAT WHERE A PATENT WILL BE INFRINGED, OUR
OFFICE SHOULD NOT FOLLOW THE LINE OF REASONING IN 38 COMP. GEN. 276
(1958), WHEREIN WE INTERPRETED THE PROVISIONS OF 28 U.S.C. 1498, WHICH
YOU CONSTRUE AS "NOT ALLOWING THE CANCELLATION OF IFB'S DUE TO POSSIBLE
PATENT INFRINGEMENT BY THE WINNING BIDDER," AND IN 46 COMP. GEN. 205
(1966), TO THE EFFECT THAT:
" *** THE COURTS HAVE RECOGNIZED SECTION 1498 AS CONSTITUTING IN
EFFECT AN EMINENT DOMAIN STATUTE, WHICH VESTS IN THE GOVERNMENT THE
RIGHT TO USE ANY PATENT GRANTED BY IT UPON PAYMENT OF REASONABLE
COMPENSATION TO THE PATENT HOLDER. *** " YOU NOTE THAT "IN NO CASE THAT
OUR RESEARCH HAS DEVELOPED DID THE AGENCY USE THE PATENT HOLDER'S DATA
AS THE SPECIFICATION FOR THE PROCUREMENT. BY USING THE SPECIFICATION,
THE GOVERNMENT LAID BARE THE STEP BY STEP PROCESSES FOR THE PRODUCTION
OF THE EQUIPMENT." FURTHER, YOU STATE:
"THE PROTESTANT PROPOSES THAT THE COMPTROLLER GENERAL ESTABLISH A
DEFINITIVE RULE GOVERNING THE ALLOWANCE OF PRE-AWARD PROTESTS AGAINST
SOLICITATIONS WHICH CONTAIN PATENT DATA AS AN INTEGRAL PART OF THE
CONTRACT SPECIFICATION THEREBY MAKING PERFORMANCE UNDER THE RESULTANT
CONTRACT ONE WHICH WOULD INFRINGE THE PATENT. THE ELEMENTS OF SUCH A
RULE, CONSISTENT WITH CASE LAW AND THE INTENT OF SEC 1498, WOULD BE AS
FOLLOWS:
"1. A PATENTEE PROTESTS THE USE OF PATENTED INFORMATION IN A
SOLICITATION, ASSERTING THAT PERFORMANCE THEREUNDER WOULD RESULT IN
PATENT INFRINGEMENT, AND
"2. THE PROTEST IS RECEIVED PRIOR TO CONTRACT AWARD, AND
"3. (A) THE GOVERNMENT, REPRESENTED BY THE PROCURING ACTIVITY,
ADMITS THE USE OF THE PATENTED DATA IN SOLICITATION, PERFORMANCE UNDER
WHICH WOULD RESULT IN PATENT INFRINGEMENT OR
(B) THE GOVERNMENT STATES THAT IT DOES NOT KNOW, OR THAT IT DENIES,
THAT THERE IS PATENT INFORMATION IN THE SOLICITATION OR THAT PERFORMANCE
UNDER THE SOLICITATION WILL VIOLATE THE PATENT, AND THE PATENTEE
DEMONSTRATES TO THE GOVERNMENT (EITHER THE PROCURING ACTIVITY OR THE
GENERAL ACCOUNTING OFFICE), BY THE SUBSTANTIAL WEIGHT OF THE EVIDENCE,
THAT THERE IS BOTH PATENT INFORMATION IN THE SOLICITATION AND THAT
PERFORMANCE THEREUNDER WILL VIOLATE THE PATENT.
"IF THE SPECIFIED ELEMENTS OF THE RULE ARE MET, THE SOLICITATION
WOULD THEN BE CANCELLED AS PROVIDED FOR IN ASPR 2-404.1(B)(VIII) - ' FOR
OTHER REASONS, CANCELLATION IS CLEARLY IN THE BEST INTEREST OF THE
GOVERNMENT.'"
WE HAVE CAREFULLY CONSIDERED YOUR LEGAL ARGUMENTS BUT WE ARE NOT
PERSUADED THAT OUR POSITION AS ANNOUNCED IN 46 COMP. GEN., SUPRA, IS
INAPPLICABLE HERE.
MOREOVER, OUR OFFICE IS IN NO POSITION TO MAKE SUBSTANTIVE
DETERMINATIONS CONCERNING POSSIBLE PATENT VIOLATIONS. WE INVITE YOUR
ATTENTION TO OUR DECISION B-162385, NOVEMBER 20, 1967, WHERE WE
RECOGNIZED THAT OUR OFFICE HAS NO JURISDICTION IN THE ADMINISTRATIVE
SETTLEMENT OF PATENT INFRINGEMENT CLAIMS. FURTHER, WE STATED IN
B-160745, JULY 27, 1967, AS FOLLOWS:
" *** AND SINCE WE HAVE NEITHER THE NECESSARY EXPERTISE REQUIRED TO
PASS UPON THE VALIDITY OF THE PATENT INVOLVED NOR THE REQUISITE
FACILITIES FOR MAKING A SOUND JUDGMENT AS TO THE ALLEGED INFRINGEMENT
AND VALUE OF THE USE OF THE PATENT, WE FEEL THAT SUCH CLAIMS PROPERLY
MAY NOT BE CONSIDERED OR SETTLED BY OUR OFFICE." ALSO, WE HAVE HELD THAT
EVEN IF A CLAIM OF PATENT INFRINGEMENT IS MERITORIOUS, IN CONSONANCE
WITH OUR POSITION ON THESE MATTERS, SUCH A FACT WOULD NOT PREVENT THE
AWARD OF A CONTRACT. SEE B-157485, NOVEMBER 26, 1965; AND B-166788,
JULY 31, 1969.
IN LIGHT OF THE FOREGOING, WE BELIEVE THAT LOE MUST RELY ON THE
STATUTORY REMEDY PROVIDED BY 28 U.S.C. 1498 OR UPON THE PROCEDURES FOR
ADMINISTRATIVE SETTLEMENT OF PATENT INFRINGEMENT CLAIMS PRESCRIBED BY
ASPR 9-401, ET SEQ.
ACCORDINGLY, THE PROTESTS OF LOE INDUSTRIES ARE DENIED.
B-171095, MAY 4, 1971
BID PROTEST - BIDDER RESPONSIBILITY
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST AWARD OF
CONTRACT TO EAST COAST ENGINEERING (ECE), LOW BIDDER, UNDER AN IFB
ISSUED BY ROBINS AFB, FOR CERTAIN ALTERATIONS AND ELECTRICAL REPAIRS.
ALTHOUGH THE CONTRACTING OFFICER WAS INITIALLY UNABLE TO MAKE AN
AFFIRMATIVE FINDING THAT ECE MET THE MINIMUM STANDARDS OF A RESPONSIBLE,
PROSPECTIVE CONTRACTOR, THERE IS NO BASIS FOR PRECLUDING A CONTRACTING
OFFICER FROM REEVALUATING A BIDDER'S RESPONSIBILITY BASED ON ADDITIONAL
INFORMATION. FURTHER, NOTWITHSTANDING THAT THE MATTER WAS REFERRED TO
THE SBA FOR A COC, SUCH CERTIFICATE WAS NEVER ISSUED DUE TO THE
CONTRACTING OFFICER'S REEVALUATION. THEREFORE SBA'S ACTIONS ARE
IMMATERIAL. ALSO, BECAUSE THE WAGE RATES INCORPORATED IN THE IFB WERE
ABOUT TO EXPIRE, AN AWARD WAS PROPER UNDER ASPR 2-407.8(B)(2) REGARDLESS
OF THE PENDING PROTEST.
TO VALLEY CONSTRUCTION COMPANY:
REFERENCE IS MADE TO YOUR TELEGRAM OF NOVEMBER 10, 1970, AND
SUBSEQUENT CORRESPONDENCE CONCERNING YOUR PROTEST UNDER INVITATION FOR
BIDS NO. DACA21-71-B-0002, WHICH WAS ISSUED BY THE DISTRICT ENGINEER,
U.S. ARMY, SAVANNAH, GEORGIA, ON JULY 24, 1970, FOR ALTERATIONS AND
ELECTRICAL REPAIRS TO CERTAIN FACILITIES AT ROBINS AIR FORCE BASE,
HOUSTON COUNTY, GEORGIA.
WHEN BIDS WERE OPENED ON SEPTEMBER 15, 1970, THE PROCURING ACTIVITY
DETERMINED THAT EAST COAST ENGINEERING (ECE), HAD SUBMITTED THE LOWEST
BID FOR THE WORK TO BE AWARDED IN THE AMOUNT OF $1,113,247 AND THAT YOUR
COMPANY HAD SUBMITTED THE SECOND LOWEST BID FOR THE WORK IN THE AMOUNT
OF $1,161,000. IT WAS ALSO NOTED THAT ECE HAD REPRESENTED ITS BUSINESS
STATUS AS AN INDIVIDUAL ORGANIZATION IN PARAGRAPH 3 OF STANDARD FORM
19-B, REPRESENTATIONS AND CERTIFICATIONS, WHICH WAS MADE A PART OF THE
COMPANY'S BID, AND THAT JOHN E. MCMICHEN HAD SIGNED ECE'S BID AS OWNER
OF THE CONCERN.
SUBSEQUENTLY, ECE CLAIMED THAT IT MADE A MISTAKE IN COMPUTING ITS BID
AND SUBMITTED WORKING PAPERS TO THE CONTRACTING OFFICER IN SUPPORT OF
THE ALLEGED ERROR. AFTER DISCUSSING THE MATTER WITH THE CONTRACTING
OFFICER ECE WITHDREW ITS CLAIM OF MISTAKE IN BID.
THE RECORD ALSO INDICATES THAT THE CONTRACTING OFFICER REQUESTED ECE
TO FURNISH DATA TO THE PROCURING ACTIVITY BY SEPTEMBER 30, 1970,
CONCERNING ITS FINANCIAL RESOURCES AND CAPACITY TO ACCOMPLISH THE WORK.
THE CONTRACTING OFFICER STATES THAT THIS DATA INCLUDED A LIST OF
PREVIOUS JOBS, WHICH ECE HAD PRIMARILY PERFORMED AS AN ELECTRICAL
SUBCONTRACTOR, AND A COPY OF A JOINT VENTURE AGREEMENT, DATED SEPTEMBER
22, 1970, BETWEEN ECE AND SOUTHERN ELECTRIC COMPANY, INC., A FLORIDA
CORPORATION, FOR THE PURPOSE OF PERFORMING ANY CONTRACT AWARDED TO ECE
UNDER THE SUBJECT IFB.
AFTER EVALUATING THE MATERIAL FURNISHED BY ECE THE CONTRACTING
OFFICER WAS UNABLE TO MAKE AN AFFIRMATIVE FINDING THAT THE CONCERN MET
THE MINIMUM STANDARDS OF A RESPONSIBLE, PROSPECTIVE CONTRACTOR,
ESPECIALLY WITH RESPECT TO ITS FINANCIAL CAPACITY, WHICH ARE SET FORTH
IN ARMED SERVICES PROCUREMENT REGULATION (ASPR) 1-903.1 AND 1-903.2 AS
FOLLOWS:
"1-903 MINIMUM STANDARDS FOR RESPONSIBLE PROSPECTIVE CONTRACTORS.
1-903.1 GENERAL STANDARDS. EXCEPT AS OTHERWISE PROVIDED IN THIS
PARAGRAPH 1-903, A PROSPECTIVE CONTRACTOR MUST:
(I) HAVE ADEQUATE FINANCIAL RESOURCES, OR THE ABILITY TO OBTAIN SUCH
RESOURCES AS REQUIRED DURING PERFORMANCE OF THE CONTRACT (SEE DEFENSE
CONTRACT FINANCING REGULATIONS, PART 2, APPENDIX E, AND ANY AMENDMENTS
THERETO; SEE ALSO 1-904.2 AND 1-905.2; FOR SBA CERTIFICATES OF
COMPETENCY, SEE 1-705.4);
(II) BE ABLE TO COMPLY WITH THE REQUIRED OR PROPOSED DELIVERY OR
PERFORMANCE SCHEDULE, TAKING INTO CONSIDERATION ALL EXISTING BUSINESS
COMMITMENTS, COMMERCIAL AS WELL AS GOVERNMENTAL (FOR SBA CERTIFICATES OF
COMPETENCY, SEE 1-705.4);
(III) HAVE A SATISFACTORY RECORD OF PERFORMANCE (CONTRACTORS WHO ARE
SERIOUSLY DEFICIENT IN CURRENT CONTRACT PERFORMANCE, WHEN THE NUMBER OF
CONTRACTS AND THE EXTENT OF DEFICIENCY OF EACH ARE CONSIDERED, SHALL, IN
THE ABSENCE OF EVIDENCE TO THE CONTRARY OR CIRCUMSTANCES PROPERLY BEYOND
THE CONTROL OF THE CONTRACTOR, BE PRESUMED TO BE UNABLE TO MEET THIS
REQUIREMENT). PAST UNSATISFACTORY PERFORMANCE, DUE TO FAILURE TO APPLY
NECESSARY TENACITY OR PERSEVERANCE TO DO AN ACCEPTABLE JOB, SHALL BE
SUFFICIENT TO JUSTIFY A FINDING OF NONRESPONSIBILITY. (IN THE CASE OF
SMALL BUSINESS CONCERNS, SEE 1-705.4(C)(VI) AND 1-905.2.);
(IV) HAVE A SATISFACTORY RECORD OF INTEGRITY (IN THE CASE OF A SMALL
BUSINESS CONCERN, SEE 1-705.4(C)(VI).); AND
(V) BE OTHERWISE QUALIFIED AND ELIGIBLE TO RECEIVE AN AWARD UNDER
APPLICABLE LAWS AND REGULATIONS, E.G., SECTION XII, PARTS 6 AND 8 (IN
THE CASE OF A SMALL BUSINESS CONCERN, SEE 1-705.4(C)(V).).
1-903.2 ADDITIONAL STANDARDS
(A) STANDARDS FOR PRODUCTION, MAINTENANCE, CONSTRUCTION, AND RESEARCH
AND DEVELOPMENT CONTRACTS.
IN ADDITION TO THE STANDARDS IN 1-903.1, IN PROCUREMENT INVOLVING
PRODUCTION, MAINTENANCE, CONSTRUCTION (SEE 18-106), OR RESEARCH AND
DEVELOPMENT WORK (AND IN OTHER PROCUREMENT AS APPROPRIATE), A
PROSPECTIVE CONTRACTOR MUST:
(I) HAVE THE NECESSARY ORGANIZATION, EXPERIENCE, OPERATIONAL CONTROLS
AND TECHNICAL SKILLS, OR THE ABILITY TO OBTAIN THEM (INCLUDING WHERE
APPROPRIATE, SUCH ELEMENTS AS PRODUCTION CONTROL PROCEDURES, PROPERTY
CONTROL SYSTEM AND QUALITY ASSURANCE MEASURES APPLICABLE TO MATERIALS
PRODUCED OR SERVICES PERFORMED BY THE PROSPECTIVE CONTRACTOR AND
SUBCONTRACTORS (SEE 1-903.4)); AND
(II) HAVE THE NECESSARY PRODUCTION, CONSTRUCTION, AND TECHNICAL
EQUIPMENT AND FACILITIES, OR THE ABILITY TO OBTAIN THEM. WHERE A
PROSPECTIVE CONTRACTOR PROPOSES TO USE THE FACILITIES OR EQUIPMENT OF
ANOTHER CONCERN, NOT A SUBCONTRACTOR, OR OF HIS AFFILIATE (SEE
2-201(A)B(II) AND (B)(XVII)), ALL EXISTING BUSINESS ARRANGEMENTS, FIRM
OR CONTINGENT, FOR THE USE OF SUCH FACILITIES OR EQUIPMENT SHALL BE
CONSIDERED IN DETERMINING THE ABILITY OF THE PROSPECTIVE CONTRACTOR TO
PERFORM THE CONTRACT; SEE ALSO 1-904.2." IN VIEW THEREOF, THE
CONTRACTING OFFICER REFERRED THE QUESTION OF THE CAPACITY AND CREDIT OF
ECE TO THE ATLANTA REGIONAL OFFICE OF THE SMALL BUSINESS ADMINISTRATION
(SBA), BY LETTER OF SEPTEMBER 30, 1970, IN ACCORDANCE WITH ASPR
1-705.4(C).
IN THIS REGARD THE SBA HAS FURNISHED OUR OFFICE WITH A REPORT
CONCERNING THE ACTIONS TAKEN BY THE AGENCY IN RESPONSE TO THIS REFERRAL.
THE REPORT STATES THAT SBA REPRESENTATIVES CONTACTED ECE AND THE
COMPANY SUBMITTED AN APPLICATION FOR A CERTIFICATE OF COMPETENCY (COC)
OF THE CONCERN'S CAPACITY AND CREDIT TO SATISFACTORILY ACCOMPLISH THE
REQUIREMENTS OF THE IFB. PURSUANT TO SUCH APPLICATION THE SBA INITIATED
AN INVESTIGATION OF THE COMPANY'S COMPETENCY TO PERFORM THE CONTRACT.
THE RECORD INDICATES THAT DURING THIS INVESTIGATION SBA
REPRESENTATIVES SUGGESTED THAT THE JOINT VENTURE AGREEMENT, NOTED ABOVE,
BE AMENDED TO PROVIDE THAT SOUTHERN ELECTRIC COMPANY EXPRESSLY ASSUME
RESPONSIBILITY FOR TIMELY COMPLETING PERFORMANCE OF THE CONTRACT, TO BE
FINANCIALLY RESPONSIBLE TO ALL SUPPLIERS AND SUBCONTRACTORS, AND TO
AUTHORIZE ECE TO CONTRIBUTE ITS SHARE OF ANY CALLS FOR FUNDS UNDER THE
AGREEMENT BY MEANS OF A PROMISSORY NOTE. THE SBA STATES THAT IN
ACCORDANCE WITH SUCH ADVICE THE JOINT VENTURE AGREEMENT WAS MODIFIED, AS
RECOMMENDED, BY AMENDMENTS DATED OCTOBER 21, 1970.
ADDITIONALLY, SBA REPRESENTATIVES SUGGESTED THAT A LETTER BE OBTAINED
FROM A BANK ESTABLISHING A $50,000 OPEN LINE OF CREDIT. IN COMPLIANCE
WITH THIS SUGGESTION SOUTHERN ELECTRIC COMPANY, OBTAINED A LETTER DATED
OCTOBER 21, 1970, FROM THE FLORIDA NATIONAL BANK, IN WHICH THE BANK
STATED THAT IT WOULD PROVIDE LOANS TO SOUTHERN ELECTRIC COMPANY, INC.,
UP TO $50,000 FOR THE PERFORMANCE OF THE PROPOSED CONTRACT.
THE REGIONAL OFFICE CERTIFICATE OF COMPETENCY REVIEW COMMITTEE
CONSIDERED THE APPLICATION OF ECE ON OCTOBER 23, 1970, AND RECOMMENDED
THAT A COC BE ISSUED. SINCE THE DOLLAR AMOUNT OF THE PROPOSED CONTRACT
EXCEEDED THE AMOUNT WHICH HAD BEEN ESTABLISHED IN THE DELEGATED
AUTHORITY OF THE REGIONAL DIRECTOR FOR THE ISSUANCE OF A CERTIFICATE OF
COMPETENCY, THE FILE WAS FORWARDED TO SBA, WASHINGTON, D.C., FOR A FINAL
DECISION ON THE APPLICATION. THE FILE WAS REVIEWED BY AN INDUSTRIAL
SPECIALIST, WHO DETERMINED THAT THE APPLICANT HAD THE NECESSARY CAPACITY
TO PERFORM, AND BY THE DEPUTY DIRECTOR, OFFICE OF FINANCE, WHO
DETERMINED THAT THE APPLICANT HAD THE NECESSARY CREDIT TO PERFORM.
WHILE THE APPLICATION WAS BEING CONSIDERED BY THE SBA, THE
CONTRACTING OFFICER DETERMINED ON NOVEMBER 6, 1970, THAT ECE WAS
RESPONSIBLE FOR PURPOSES OF THIS PROCUREMENT AND WITHDREW THE REFERRAL
OF ECE'S COMPETENCY FROM THE SBA. ACCORDINGLY, THE SBA DID NOT ISSUE A
COC TO ECE IN THIS MATTER.
THE CONTRACTING OFFICER STATES THAT HE WAS ABLE TO DETERMINE THAT ECE
WAS A RESPONSIBLE CONTRACTOR BASED ON ADDITIONAL INFORMATION WHICH HE
OBTAINED AFTER THE QUESTION OF THE COMPETENCY OF ECE HAD BEEN REFERRED
TO THE SBA. THIS DATA WAS SET FORTH IN THE DETERMINATION OF THE
RESPONSIBILITY OF ECE BY THE CONTRACTING OFFICER IN PERTINENT PART AS
FOLLOWS:
"SUBSEQUENT TO THE REQUEST FOR ASSISTANCE FROM THE SMALL BUSINESS
ADMINISTRATION MENTIONED ABOVE, INFORMATION HAS BEEN FURNISHED TO ME
WHICH DEMONSTRATES THE VAST EXPERIENCE HISTORY OF MR. JOHN E. MCMICHEN,
EXTENDING FROM HIS DISCHARGE FROM THE ARMY IN APPROXIMATELY 1947 UP TO
THE FORMATION OF EAST COAST ENGINEERING COMPANY IN EARLY 1970. IT IS
APPARENT TO ME FROM THIS EXPERIENCE RECORD THAT MR. MCMICHEN HAS BEEN
INVOLVED EXTENSIVELY WITH GOVERNMENT SPONSORED PROJECTS, SERVING IN MOST
CASES IN A HIGH MANAGERIAL CAPACITY. WHILE SERVING AS DIVISION MANAGER
FOR CONSTRUCTION IN THE SOUTHEAST WITH MEVA CORPORATION DURING THE YEARS
1968 THROUGH 1970, MR. MCMICHEN MAINTAINED CONTROL OVER THE ELECTRICAL
INSTALLATIONS FOR THE SOUTHEASTERN SIGNAL SCHOOL, AND 7 & 11 EM
BARRACKS, FORT GORDON, GEORGIA, MULTI-MILLION DOLLAR PROJECTS WHICH WAS
UNDER THE ADMINISTRATIVE SUPERVISION OF THIS DISTRICT.
"MR. BOSTICK OF INDIAN RIVER CONSTRUCTION COMPANY, PRIME CONTRACTOR,
ADVISED THAT EAST COAST ENGINEERING WAS PROCEEDING REAL WELL ON THEIR
JOB AS SUBCONTRACTOR AT CITY OF THOMPSON, GEORGIA, WATER TREATMENT
PLANT. MR. BOSTICK ALSO STATED THAT HE HAD KNOWN MR. MCMICHEN FOR OVER
20 YEARS AND HE CONSIDERED HIM TO BE ONE OF THE BEST PROJECT ENGINEERS
IN THE ENTIRE COUNTRY. MR. BOSTICK WAS AN ENGINEER FOR THE CITY OF
JACKSONVILLE, FLORIDA, FOR MANY YEARS. DAVID WIDENER, AN OFFICIAL OF
SOUTHWIDE CONSTRUCTION COMPANY, INC., ADVISES THAT EAST COAST
ENGINEERING, INC., HAD BEEN EMPLOYED BY SOUTHWIDE AS ELECTRICAL
SUBCONTRACTOR ON THE BELL AUDITORIUM REMODELING JOB FOR THE CITY OF
AUGUSTA, GEORGIA, AND A REHAB AND TRANSFORMER CONTRACT FOR THE POST
ENGINEER, FORT STEWART, GEORGIA, AND PERFORMED THEIR WORK IN A
SATISFACTORY MANNER.
"EAST COAST ENGINEERING WAS AWARDED A CONTRACT BY THIS DISTRICT ON 30
SEPTEMBER 1970 FOR INCREASED TRANSFORMER CAPACITY, AREA I & II, FAMILY
HOUSING, FORT BRAGG, NORTH CAROLINA, IN THE AMOUNT OF $44,447. THE
COMPLETION DATE OF THIS CONTRACT IS IN MARCH 1971.
"I AM ADVISED BY MY RESIDENT ENGINEER, FORT GORDON, GEORGIA, THAT
EAST COAST ENGINEERING WAS COOPERATIVE AND DID A GOOD JOB AS THE
SUBCONTRACTOR FOR THE LINE WORK INCLUDED UNDER A CONTRACT AWARDED TO
PRIME CONTRACTOR, A. B. LEE, FAMILY HOUSING IMPROVEMENT PROJECT, WHICH
HAS JUST RECENTLY BEEN COMPLETED.
"IN CONSIDERING ADEQUATE FINANCIAL RESOURCES, OR THE ABILITY TO
OBTAIN SUCH RESOURCES AS NECESSARY DURING PERFORMANCE OF THE CONTRACT AS
REQUIRED UNDER THE MINIMUM STANDARDS FOR RESPONSIBLE PROSPECTIVE
CONTRACTORS, ASPR 1-903.1(I), I CONSIDER THE AGREEMENT BETWEEN EAST
COAST AND SOUTHERN ELECTRIC COMPANY, REFERRED TO ABOVE, MORE SIGNIFICANT
WHEN DETERMINING THE ABILITY OF EAST COAST ENGINEERING TO OBTAIN FUNDS
OR RESOURCES DURING THE PERFORMANCE OF THE WORK UNDER THE CONTRACT.
"IN ARRIVING AT ANY CONCLUSION, THE EXPERIENCE AVAILABLE TO THE
APPARENT LOW BIDDER THROUGH ITS CONNECTIONS WITH SOUTHERN ELECTRIC
COMPANY WAS ALSO CONSIDERED. UNDER THE AGREEMENT ARRANGEMENT, A TOTAL
OF 28 EMPLOYEES WILL BE AVAILABLE FOR THE PERFORMANCE OF THE WORK, EVEN
THOUGH EAST COAST'S PRESENT INTENTIONS ARE TO SUBCONTRACT ALL OF THE
WORK WITH THE EXCEPTION OF ELECTRICAL CONSTRUCTION. SOUTHERN ELECTRIC
WAS FOUNDED APPROXIMATELY 1911, AND, ACCORDING TO AT LEAST TWO SOURCES
(W. E. ARNOLD COMPANY, PRIME CONTRACTOR, AND KOGER PROPERTIES), SOUTHERN
ELECTRIC IS CONSIDERED ONE OF THE BETTER ELECTRICAL INSTALLERS IN THE
COUNTRY.
"INFORMATION HAS BEEN FURNISHED BY MR. DON ROBINSON WITH THE SURETY
UNDERWRITERS, INC. (WHO ALSO APPEARS AS ONE OF THOSE WHO ARE APPOINTED
ATTORNEY IN FACT ON THE COPY OF THE CERTIFIED COPY OF POWER OF ATTORNEY
ATTACHED TO THE BID BOND), THAT THE UNDERWRITERS HANDLES ALL INSURANCE
AS REQUIRED BY THE INVITATION AND THAT HIS COMPANY WOULD FURNISH ALL
BONDING REQUIREMENTS WHICH INCLUDES PERFORMANCE AND PAYMENT BONDS. THE
FLORIDA NATIONAL BANK OF JACKSONVILLE, THROUGH ITS FINANCE COMMITTEE,
HAS APPROVED LOANS UP TO $50,000 TO BE USED IN CONNECTION WITH THIS
SPECIFIC JOB.
"THE TOOLS AND EQUIPMENT AVAILABLE TO EAST COAST ENGINEERING IS
CONSIDERED TO BE MORE THAN ADEQUATE FOR THE ELECTRICAL INSTALLATION.
SUBCONTRACTORS FOR OTHER PORTIONS, SUCH AS CATWALKS AND LADDERS, WILL
FURNISH THEIR OWN TOOLS AND EQUIPMENT NECESSARY FOR PERFORMANCE.
"EAST COAST SUBMITTED AN ITEMIZED PROGRESS CHART WITH A MONTHLY CASH
FLOW PROJECTION SCHEDULE DEMONSTRATING THEIR PLAN FOR FINANCING AND
PERFORMING THE WORK.
"FROM THE FOREGOING INFORMATION, I DEEM THAT EAST COAST ENGINEERING,
MARTINEZ, GEORGIA, APPARENT LOW BIDDER, TO BE RESPONSIBLE AND CAPABLE OF
SATISFACTORY PERFORMANCE OF THE CONTRACT."
IN VIEW OF THE CONTRACTING OFFICER'S FINDING OF RESPONSIBILITY, AND
SINCE THE WAGE RATES FOR THE PROCUREMENT WERE TO EXPIRE ON DECEMBER 3,
1970, THE DEPARTMENT OF THE ARMY ADVISED OUR OFFICE ON NOVEMBER 27,
1970, THAT IT WAS MAKING AN AWARD TO ECE WITHOUT AWAITING OUR DECISION
ON YOUR PROTEST.
YOU MAINTAIN THAT THE CONTRACTING OFFICER IMPROPERLY ACCEPTED A COC
FROM THE SBA EVEN THOUGH THE OFFICER HAD ORIGINALLY DETERMINED THAT ECE
WAS NONRESPONSIBLE FOR THIS PROCUREMENT; THAT ECE FAILED TO REVEAL THE
EXISTENCE OF ANY JOINT VENTURE IN ITS BID IN VIOLATION OF ASPR 7-602.32;
THAT THE CONTRACTING OFFICER COULD NOT HAVE FOUND ECE RESPONSIBLE
EXCEPT FOR THE COMPANY'S AFFILIATION WITH SOUTHERN ELECTRIC; THAT THE
CONTRACTING OFFICER WAS PRECLUDED BY ASPR 1-904.2(A) FROM CONSIDERING
SUCH AFFILIATION IN DETERMINING ECE'S RESPONSIBILITY; THAT ECE LACKS
THE EXPERIENCE AND TECHNICAL CAPACITY TO PERFORM THE CONTRACT; AND THAT
THE CONTRACTING OFFICER WAS NOT JUSTIFIED IN MAKING AN AWARD TO ECE ON
DECEMBER 2, 1970, IN VIEW OF YOUR PENDING PROTEST.
YOU HAVE ALSO ALLEGED THAT THE SBA ACTED IMPROPERLY WITH RESPECT TO
ECE'S APPLICATION FOR A CERTIFICATE OF COMPETENCY BY TAKING AFFIRMATIVE
ACTIONS TO MAKE ECE RESPONSIBLE. IN THIS CONNECTION YOU STATE THAT THE
SBA OBTAINED FORBEARANCE COMMITMENTS FROM SUPPLIERS AND SUBCONTRACTORS
WITHOUT WHICH THE BIDDER COULD NOT COMPLETE THE CONTRACT; AND THAT THE
SBA OBTAINED NEW SOURCES OF CREDIT FOR THE BIDDER.
IN VIEW OF THESE ALLEGATIONS YOU MAINTAIN THAT ECE'S CONTRACT SHOULD
BE CANCELED AND AN AWARD MADE TO YOUR CONCERN.
WITH RESPECT TO YOUR CONTENTION THAT THE CONTRACTING OFFICER
IMPROPERLY ACCEPTED A COC FROM THE SBA EVEN THOUGH THE OFFICER HAD
FORMALLY FOUND ECE TO BE NONRESPONSIBLE, THE RECORD CLEARLY INDICATES
THAT SBA DID NOT, AT ANY TIME, ISSUE A COC FOR ECE. INSTEAD, THE
CONTRACTING OFFICER'S DETERMINATION THAT ECE IS A RESPONSIBLE BIDDER
APPEARS TO HAVE BEEN BASED UPON ADDITIONAL INFORMATION WHICH CAME TO HIS
ATTENTION SUBSEQUENT TO THE REFERRAL TO SBA. WE ARE NOT AWARE OF ANY
BASIS FOR PRECLUDING A CONTRACTING OFFICER FROM REEVALUATING A BIDDER'S
RESPONSIBILITY UNDER SUCH CIRCUMSTANCES.
WITH RESPECT TO YOUR ALLEGATION THAT ECE FAILED TO REVEAL THE
EXISTENCE OF ANY JOINT VENTURE IN ITS BID, IN VIOLATION OF THE
PROCUREMENT REGULATION, THE RECORD SHOWS THAT THE JOINT VENTURE
AGREEMENT WAS ENTERED INTO AFTER BID OPENING. IN VIEW OF THIS
CIRCUMSTANCE, WE PERCEIVE NO LEGAL BASIS FOR QUESTIONING THE
ORGANIZATIONAL STATUS WHICH ECE REPRESENTED IN ITS BID PRIOR TO BID
OPENING.
IN THIS REGARD YOU STATE THAT THE CONTRACTING OFFICER FAILED TO
EVALUATE EACH JOINT VENTURER AS A SEPARATE ENTITY AS REQUIRED BY OUR
DECISION B-153144, JUNE 4, 1964. BY THIS STATEMENT WE INFER THAT YOU
MEAN THE CONTRACTING OFFICER WAS PRECLUDED FROM RELYING UPON THE
PROVISIONS OF THE JOINT VENTURE AGREEMENT IN DETERMINING THE
RESPONSIBILITY OF ECE.
IN THE ABOVE CITED DECISION OUR OFFICE CRITICIZED THE FAILURE OF A
PROCURING ACTIVITY TO SUBSTANTIATE THE ASSERTIONS AN INDIVIDUAL BIDDER
MADE WITH RESPECT TO GUARANTEES OF FINANCIAL ASSISTANCE AND SUPPORT
WHICH WERE ALLEGEDLY MADE BY ANOTHER CONCERN TO THE BIDDER. WE HELD
THAT, AT A MINIMUM, A THOROUGH EVALUATION SHOULD BE MADE WHERE A BIDDER
CERTIFIES THAT IT IS AN INDIVIDUAL ORGANIZATION, YET THE BIDDER
INDICATES THAT IT WILL PERFORM THE PROPOSED CONTRACT IN CONJUNCTION WITH
ANOTHER FIRM. HOWEVER, THE DECISION DID NOT STATE THAT IT WOULD BE
IMPROPER FOR THE CONTRACTING OFFICER TO CONSIDER COMMITMENTS OF SUPPORT
FROM A THIRD PARTY SO LONG AS THE ACTIVITY HAD DETERMINED THAT SUCH
COMMITMENTS WERE FIRM.
IN THE INSTANT CASE WE CANNOT CONCLUDE THAT THE PROCURING ACTIVITY
FAILED TO THOROUGHLY EVALUATE THE JOINT VENTURE AGREEMENT BETWEEN THE
PARTIES. IN THIS REGARD OUR OFFICE HAS BEEN FURNISHED A COPY OF THE
JOINT VENTURE AGREEMENT BETWEEN ECE AND SOUTHERN ELECTRIC, AS AMENDED.
THE AGREEMENT SPECIFICALLY REFERS TO THE PROPOSED CONTRACT AND STATES
THAT SOUTHERN ELECTRIC IS EXPRESSLY ASSUMING RESPONSIBILITY FOR TIMELY
COMPLETING PERFORMANCE OF THE CONTRACT, AND RESPONSIBILITY FOR PAYMENT
OF ALL SUPPLIERS AND SUBCONTRACTORS. ADDITIONALLY, WE NOTE THAT THE
AGREEMENT IS SIGNED BY THE VICE-PRESIDENT OF SOUTHERN ELECTRIC SO THAT
THERE WOULD NOT APPEAR TO BE ANY DOUBT THAT THE SIGNER WAS LEGALLY
AUTHORIZED TO BIND SOUTHERN ELECTRIC TO THE AGREEMENT. IN VIEW THEREOF,
WE CANNOT CONCLUDE THAT THE PROCURING ACTIVITY WAS PRECLUDED FROM
CONSIDERING THE PROVISIONS OF THE AGREEMENT IN DETERMINING WHETHER ECE
POSSESSED ADEQUATE FINANCIAL RESOURCES, EXPERIENCE AND TECHNICAL SKILLS,
OR THE ABILITY TO OBTAIN THEM, IN ACCORDANCE WITH THE PROVISIONS OF ASPR
1-903, QUOTED ABOVE.
WITH RESPECT TO YOUR ALLEGATION THAT THE CONTRACTING OFFICER WAS
PRECLUDED FROM RELYING ON THE PROVISIONS OF THE JOINT VENTURE AGREEMENT
IN DETERMINING THE RESPONSIBILITY OF ECE BECAUSE THE CONCERNS ARE
AFFILIATES AND ASPR 1-904.2(A) SPECIFIES THAT AFFILIATES ARE TO BE
CONSIDERED SEPARATE ENTITIES IN DETERMINING WHETHER THE ONE OF THEM
WHICH IS TO PERFORM THE CONTRACT IS RESPONSIBLE, ASPR 2-201(A), SECTION
B(II), SETS FORTH THE DEFINITION OF AFFILIATED CONCERNS IN PERTINENT
PART AS FOLLOWS:
"BUSINESS CONCERNS ARE AFFILIATES OF EACH OTHER WHEN EITHER DIRECTLY
OR INDIRECTLY (I) ONE CONCERN CONTROLS OR HAS THE POWER TO CONTROL THE
OTHER, OR (II) A THIRD PARTY CONTROLS OR HAS THE POWER TO CONTROL BOTH."
THERE IS NOTHING IN THE RECORD TO INDICATE THAT ECE AND SOUTHERN
ELECTRIC COMPANY ARE AFFILIATES WITHIN THE MEANING OF THE ABOVE
REGULATION. IN THIS REGARD THE JOINT VENTURE AGREEMENT DOES NOT
DEMONSTRATE IN ITSELF THAT EITHER ECE OR SOUTHERN ELECTRIC HAD THE
DIRECT OR INDIRECT CONTROL, OR POWER TO CONTROL, OF THE OTHER CONCERN.
IN VIEW THEREOF, THE PROVISIONS OF ASPR 1-904.2(A) ARE NOT APPLICABLE TO
THE CIRCUMSTANCES OF THE SUBJECT CASE AND WE PERCEIVE NO BASIS FOR
QUESTIONING THE PROPRIETY OF THE AWARD FOR THIS REASON.
WITH RESPECT TO YOUR ALLEGATION THAT THE SBA ACTED IMPROPERLY WITH
RESPECT TO ECE'S APPLICATION FOR A CERTIFICATE OF COMPETENCY, THE SBA
DENIES THAT ITS REPRESENTATIVES CONTACTED PROPOSED SUPPLIERS TO OBTAIN
FORBEARANCE COMMITMENTS AND OBTAINED NEW SOURCES OF CREDIT FOR ECE AS
YOU CONTEND. BASED ON OUR REVIEW WE CANNOT CONCLUDE THAT THE RECORD
SUPPORTS YOUR CONTENTIONS IN THIS RESPECT.
ON THE OTHER HAND, SBA ADMITS THAT IT SUGGESTED THE JOINT VENTURE
AGREEMENT BE MODIFIED, AS NOTED ABOVE, AND THAT A LETTER OF CREDIT BE
OBTAINED FROM A BANK. THE AGENCY STATES THAT THESE SUGGESTIONS WERE
MADE PURSUANT TO PARAGRAPH 2D OF SBA NATIONAL DIRECTIVE 615-1B, DATED
APRIL 30, 1970, WHICH PROVIDES:
"SBA SHOULD ASSIST THE APPLICANT IN DEVELOPING THE DOCUMENTATION
REQUIRED TO ESTABLISH A SHOWING OF COMPETENCY. SBA SHOULD POINT OUT
APPARENT DEFICIENCIES IN CAPACITY AND CREDIT AND REQUIRE MORE DETAILED
EXPLANATION AND DOCUMENTATION FOR BETTER PRESENTATION *** ."
IN THIS CONNECTION SECTION 2(A) OF THE SMALL BUSINESS ACT, AS
AMENDED, 15 U.S.C. 631(A), PROVIDES IN PERTINENT PART:
" *** IT IS THE DECLARED POLICY OF THE CONGRESS THAT THE GOVERNMENT
SHOULD AID, COUNSEL, ASSIST, AND PROTECT, INSOFAR AS IS POSSIBLE, THE
INTERESTS OF SMALL-BUSINESS CONCERNS IN ORDER TO PRESERVE FREE
COMPETITIVE ENTERPRISE, TO INSURE THAT A FAIR PROPORTION OF THE TOTAL
PURCHASES AND CONTRACTS OR SUBCONTRACTS FOR PROPERTY AND SERVICES FOR
THE GOVERNMENT (INCLUDING BUT NOT LIMITED TO CONTRACTS OR SUBCONTRACTS
FOR MAINTENANCE, REPAIR, AND CONSTRUCTION) BE PLACED WITH SMALL-BUSINESS
ENTERPRISES, TO INSURE THAT A FAIR PROPORTION OF THE TOTAL SALES OF
GOVERNMENT PROPERTY BE MADE TO SUCH ENTERPRISES, AND TO MAINTAIN AND
STRENGTHEN THE OVERALL ECONOMY OF THE NATION."
IN VIEW OF THE FOREGOING, AND SINCE SBA DID NOT ISSUE A COC, IT IS
OUR OPINION THAT SBA'S ACTIONS' ARE IMMATERIAL IN DETERMINING THE MERITS
OF YOUR PROTEST.
WITH RESPECT TO YOUR ALLEGATION THAT IT WAS IMPROPER FOR THE
CONTRACTING OFFICER TO MAKE AN AWARD TO ECE ON DECEMBER 2, 1970, BECAUSE
OF THE PENDENCY OF YOUR PROTEST, ASPR 2-407.8(B)(2) PROVIDES IN
PERTINENT PART AS FOLLOWS:
"(2) WHERE A PROTEST HAS BEEN RECEIVED BEFORE AWARD, THE VIEWS OF THE
OFFICE OF THE COMPTROLLER GENERAL REGARDING THE PROTEST SHOULD BE
OBTAINED BEFORE AWARD WHENEVER SUCH ACTION IS CONSIDERED TO BE
DESIRABLE. WHERE IT IS KNOWN THAT A PROTEST AGAINST THE MAKING OF AN
AWARD HAS BEEN LODGED DIRECTLY WITH THE COMPTROLLER GENERAL, A
DETERMINATION TO MAKE AWARD UNDER (3) BELOW MUST BE APPROVED AT AN
APPROPRIATE LEVEL ABOVE THAT OF THE CONTRACTING OFFICER, IN ACCORDANCE
WITH DEPARTMENTAL PROCEDURES. WHILE AWARD NEED NOT BE WITHHELD PENDING
FINAL DISPOSITION BY THE COMPTROLLER GENERAL OF A PROTEST, A NOTICE OF
INTENT TO MAKE AWARD IN SUCH CIRCUMSTANCES SHALL BE FURNISHED THE
COMPTROLLER GENERAL, AND FORMAL OR INFORMAL ADVICE SHOULD BE OBTAINED
CONCERNING THE CURRENT STATUS OF THE CASE PRIOR TO MAKING THE AWARD.
(3) WHERE A WRITTEN PROTEST AGAINST THE MAKING OF AN AWARD IS
RECEIVED, AWARD SHALL NOT BE MADE UNTIL THE MATTER IS RESOLVED, UNLESS
THE CONTRACTING OFFICER DETERMINES THAT:
(I) THE ITEMS TO BE PROCURED ARE URGENTLY REQUIRED; OR
(II) DELIVERY OR PERFORMANCE WILL BE UNDULY DELAYED BY FAILURE TO
MAKE AWARD PROMPTLY; OR
(III) A PROMPT AWARD WILL OTHERWISE BE ADVANTAGEOUS TO THE
GOVERNMENT.
IF AWARD IS MADE UNDER (I), (II), OR (III) ABOVE, THE CONTRACTING
OFFICER SHALL DOCUMENT THE FILE TO EXPLAIN THE NEED FOR AN IMMEDIATE
AWARD, AND SHALL GIVE WRITTEN NOTICE OF THE DECISION TO PROCEED WITH THE
AWARD TO THE PROTESTER AND, AS APPROPRIATE, TO OTHERS CONCERNED."
IN THIS CONNECTION THE RECORD, AS NOTED ABOVE, SHOWS THAT ON NOVEMBER
27, 1970, OUR OFFICE WAS ADVISED BY A REPRESENTATIVE OF THE OFFICE OF
THE ASSISTANT SECRETARY OF THE ARMY (INSTALLATIONS AND LOGISTICS) THAT
THE DEPARTMENT NEEDED TO MAKE AN AWARD PRIOR TO DECEMBER 3, 1970,
BECAUSE THE WAGE RATES INCORPORATED IN THE SUBJECT IFB WERE TO EXPIRE ON
THAT DAY. ASPR 18-704.2, WAGE DETERMINATIONS, PROVIDES THAT
DETERMINATIONS ARE EFFECTIVE FOR 120 CALENDAR DAYS FROM THE DATE OF
ISSUANCE AND ARE VOID FOR INCORPORATION INTO CONTRACTS AWARDED AFTER
THAT PERIOD. IT HAS NOT BEEN THE POLICY OF THE DEPARTMENT OF LABOR TO
GRANT EXTENSIONS OF WAGE RATE DETERMINATIONS, AND IF AN EXTENSION OF THE
SUBJECT WAGE RATES HAD BEEN REQUESTED BY THE PROCURING ACTIVITY, THE
DEPARTMENT OF LABOR MAY WELL HAVE DENIED SUCH REQUEST. IN THAT EVENT
THE PROCURING ACTIVITY WOULD HAVE BEEN REQUIRED BY ASPR 18-704.2(A)(5)
TO CANCEL THE IFB IF AN AWARD HAD NOT BEEN MADE PRIOR TO DECEMBER 3,
1970.
IN VIEW OF THE POSSIBILITY THAT IT MAY HAVE BEEN NECESSARY TO CANCEL
THE PROCUREMENT HAD AN AWARD NOT BEEN MADE ON DECEMBER 2, AND SINCE THE
ARMY DID COMPLY WITH THE PROVISIONS OF ASPR 2-407(B)(2) QUOTED ABOVE, WE
SEE NO VALID BASIS ON WHICH TO QUESTION THE DETERMINATION OF THE ARMY TO
PROCEED WITH AN AWARD DESPITE THE PENDING PROTEST.
WHETHER A BIDDER IS, OR IS NOT, CAPABLE OF PRODUCING IN ACCORDANCE
WITH CONTRACT REQUIREMENTS IS A QUESTION OF FACT, AND ABSENT EVIDENCE
THAT THE DETERMINATION OF A BIDDER'S CAPABILITIES WAS BASED ON ERROR,
FRAUD, OR FAVORITISM, OUR OFFICE WILL ACCEPT THE FINDINGS OF THE
CONTRACTING AGENCY. 46 COMP. GEN. 371, 372 (1966).
WE HAVE ALSO HELD THAT THE PROJECTION OF A BIDDER'S ABILITY TO
PERFORM IF AWARDED A CONTRACT IS OF NECESSITY A MATTER OF JUDGMENT,
WHICH, WHILE IT SHOULD BE BASED ON FACT AND ARRIVED AT IN GOOD FAITH,
MUST PROPERLY BE LEFT LARGELY TO THE SOUND ADMINISTRATIVE DISCRETION OF
THE CONTRACTING OFFICERS INVOLVED. SINCE CONTRACTING OFFICERS ARE IN
THE BEST POSITION TO ASSESS RESPONSIBILITY, THEY MUST BEAR THE MAJOR
BRUNT OF ANY DIFFICULTIES EXPERIENCED BY REASON OF THE CONTRACTOR'S LACK
OF ABILITY, AND THEY MUST MAINTAIN THE DAY TO DAY RELATIONS WITH THE
CONTRACTOR ON BEHALF OF THE GOVERNMENT. IT IS ALSO WELL SETTLED THAT
THE CRITICAL TIME FOR DETERMINING THE RESPONSIBILITY OF A PROSPECTIVE
CONTRACTOR IS THE TIME OF AWARD, AND THAT ALL INFORMATION AVAILABLE TO
THE CONTRACTING OFFICER AT THAT TIME SHOULD BE CONSIDERED IN MAKING SUCH
DETERMINATION, RATHER THAN ONLY THE INFORMATION AVAILABLE AT BID
OPENING. 41 COMP. GEN. 302 (1961).
YOUR FINAL OBJECTION TO THE FINDING OF ECE'S RESPONSIBILITY IS THE
ALLEGED LACK OF THE CONCERN'S EXPERIENCE ON GOVERNMENT CONTRACTS. IN
THIS REGARD THE CONTRACTING OFFICER STATES THAT ECE HAD COMPLETED WORK
IN A SATISFACTORY MANNER AS A SUBCONTRACTOR FOR THE REHABILITATION AND
TRANSFORMER CONTRACT AT FORT STEWART, GEORGIA; THAT THE COMPANY
SATISFACTORILY PERFORMED AS A SUBCONTRACTOR FOR LINE WORK UNDER A FAMILY
HOUSING PROJECT AT FORT GORDON, GEORGIA; AND THAT THE COMPANY WAS
AWARDED CONTRACT ON SEPTEMBER 30, 1970, BY THE CORPS OF ENGINEERS TO
INCREASE TRANSFORMER CAPACITY AT FORT BRAGG, NORTH CAROLINA. IN VIEW OF
THIS DATA WE ARE UNABLE TO CONCLUDE THAT THE CONCERN LACKS TECHNICAL
EXPERIENCE FOR THE CONTRACT, AS YOU ALLEGE.
BASED UPON OUR REVIEW OF THE OTHER DATA SET FORTH IN THE CONTRACTING
OFFICER'S DETERMINATION, AS NOTED ABOVE, WE FIND NO BASIS UPON WHICH OUR
OFFICE WOULD BE JUSTIFIED IN CONCLUDING THAT THERE WAS AN ABUSE OF THE
ADMINISTRATIVE DISCRETION EXERCISED IN DETERMINING THAT ECE WAS A
RESPONSIBLE PROSPECTIVE CONTRACTOR IN ACCORDANCE WITH THE STANDARDS SET
FORTH IN ASPR 1-903.
B-171168, MAY 4, 1971
BID PROTEST - BIDDER RESPONSIBILITY - CAPACITY - SBA DETERMINATION
SUSTAINING PROTEST OF METABOLIC, INC., LOW BIDDER, AGAINST THE AWARD
OF CONTRACTS TO COMMUNITY BLOOD AND PLASMA SERVICES, INC., UNDER IFB
ISSUED BY THE VA HOSPITALS AT HOUSTON AND DALLAS, TEXAS FOR PROCUREMENT
OF HUMAN WHOLE BLOOD.
DETERMINATION TO REJECT METABOLIC'S BID BECAUSE IT HAD NOT BEEN
INSPECTED BY THE CLEARING HOUSE SYSTEM OF THE AMERICAN ASSOCIATION OF
BLOOD BANKS (WHICH WAS NOT MANDATORY) WAS IMPROPER AFTER SUBMISSION OF
THE QUESTION OF ITS CAPACITY TO THE SBA AND THE ISSUANCE TO IT OF A
CERTIFICATE OF COMPETENCY. CONTRACTING OFFICER'S CLAIM THAT METABOLIC
WAS NONRESPONSIBLE FOR REASONS OTHER THAN CAPACITY AND THEREFORE OUTSIDE
THE RATING DOMAIN OF THE SBA DOES NOT WITHSTAND CLOSE SCRUTINY.
BEFORE AWARDS ARE MADE TO METABOLIC, THE COMP. GEN. BELIEVES IT WOULD
BE APPROPRIATE FOR THE CONTRACTING OFFICER TO PRESENT EVIDENCE TO THE
SBA AND SEEK A REEVALUATION.
TO MR. JOHNSON:
FURTHER REFERENCE IS MADE TO THE PROTEST OF METABOLIC, INCORPORATED,
AGAINST THE AWARD OF CONTRACTS TO COMMUNITY BLOOD & PLASMA SERVICE,
INCORPORATED, UNDER INVITATIONS FOR BIDS (IFB) NOS. 71-1 AND 549-1-71,
BY THE VETERANS ADMINISTRATION (VA) HOSPITALS AT HOUSTON AND DALLAS,
TEXAS, RESPECTIVELY, WHICH WAS THE SUBJECT OF A REPORT DATED NOVEMBER 5,
1970, FROM THE DIRECTOR OF THE SUPPLY SERVICE (REFERENCE:134G).
BOTH INVITATIONS CALLED FOR BIDS ON SUPPLYING THE HUMAN WHOLE BLOOD
AND BLOOD COMPONENTS REQUIREMENTS OF THE RESPECTIVE HOSPITALS FOR THE
PERIOD JULY 1, 1970, THROUGH JUNE 30, 1971. ALTHOUGH METABOLIC
SUBMITTED THE LOW BID UNDER EACH INVITATION, ITS BIDS WERE REJECTED AND
AWARDS MADE TO COMMUNITY, THE SECOND LOW BIDDER, ON OR ABOUT JUNE 30,
1970.
INVITATION FOR BIDS NO. 71-1 (HOUSTON) CONTAINED THE FOLLOWING
PROVISIONS APPLICABLE TO THE PROTEST:
"1. QUALIFICATIONS: (1) BIDS WILL BE CONSIDERED ONLY FROM BIDDERS
WHOSE BLOOD BANK IS APPROVED BY THE NATIONAL INSTITUTES OF HEALTH OR HAS
BEEN INSPECTED FOR THE CLEARINGHOUSE SYSTEM OF THE AMERICAN ASSOCIATION
OF BLOOD BANKS FOR THE PROCUREMENT OF BLOOD FOR TRANSFUSIONS.
(2) THE BIDDER CERTIFIED THAT HE IS OR IS NOT APPROVED (STRIKE OUT
WORDS NOT APPLICABLE) BY THE NATIONAL INSTITUTES OF HEALTH UNDER THE
FEDERAL BIOLOGICAL CONTROL LAW AS A SOURCE OF SUPPLY FOR WHOLE BLOOD AND
WILL COMPLY WITH THE REQUIREMENTS OUTLINED BELOW WITH RESPECT TO DONORS,
CONTAINERS, DELIVERY, ETC. (BIDDER MUST BE APPROVED BY THE NATIONAL
INSTITUTES OF HEALTH IF INTERSTATE SHIPMENT IS INVOLVED AND A STATEMENT
THAT SUCH APPROVAL HAS BEEN GRANTED MUST BE SUBMITTED TOGETHER WITH THE
BID).
(3) THE BIDDER CERTIFIES THAT HE HAS OR HAS NOT BEEN INSPECTED
(STRIKE OUT WORDS NOT APPLICABLE) FOR THE CLEARINGHOUSE SYSTEM OF THE
AMERICAN ASSOCIATION OF BLOOD BANKS FOR THE PROCUREMENT OF BLOOD FOR
TRANSFUSIONS.
SPECIAL NOTE TO CONTRACTING OFFICERS: INSPECTION AND ACCEPTANCE FOR
THE CLEARINGHOUSE SYSTEM OF THE AABB IS NOT MANDATORY IF BIDDER IS
APPROVED UNDER THE FEDERAL BIOLOGICAL CONTROL LAW BY NIH. IN ALL CASES
WHERE BIDDER IS NOT ACCREDITED BY AABB, THE VA WILL INSPECT HIS
FACILITIES UNDER SPECIAL CONDITION 6, INSPECTION OF BIDDER'S FACILITIES,
TO DETERMINE CONFORMANCE WITH STANDARDS OF CLEARINGHOUSE SYSTEM OF AABB.
"6. INSPECTION OF BIDDER'S FACILITIES: THE RIGHT IS RESERVED TO
THOROUGHLY INSPECT AND INVESTIGATE THE ESTABLISHMENT AND FACILITIES AND
OTHER QUALIFICATIONS OF ANY BIDDER, AND TO REJECT ANY BID IRRESPECTIVE
OF PRICE, IF IT SHOULD BE ADMINISTRATIVELY DETERMINED AS LACKING IN ANY
OF THE ESSENTIALS NECESSARY TO ASSURE ACCEPTABLE STANDARDS OF
PERFORMANCE. SUCH INSPECTION AND INVESTIGATION SHALL INCLUDE A
DETERMINATION AS TO THE BIDDER'S CONFORMANCE WITH SPECIAL CONDITIONS
2(A) AND 2(B)(1)." IFB NO. 549-1-71 (DALLAS) CONTAINED SIMILAR
PROVISIONS. BOTH INVITATIONS INCLUDED A REQUIREMENT FOR DELIVERIES TO
BE MADE WITHIN FOUR HOURS OF REQUEST.
METABOLIC COMPLETED THE ABOVE-QUOTED PROVISIONS OF BOTH INVITATIONS
TO SHOW THAT IT WAS APPROVED BY THE NATIONAL INSTITUTES OF HEALTH AS A
SOURCE OF SUPPLY FOR WHOLE BLOOD AND WOULD COMPLY WITH THE CONTRACT
REQUIREMENTS WITH RESPECT TO "DONORS, CONTAINERS, DELIVERY, ETC.," AND
THAT IT HAD NOT BEEN INSPECTED FOR THE CLEARINGHOUSE SYSTEM OF THE
AMERICAN ASSOCIATION OF BLOOD BANKS.
ON MAY 6, 1970, THE CONTRACTING OFFICER HAVING COGNIZANCE OF THE
PROCUREMENT FOR THE DALLAS VA HOSPITAL ADVISED METABOLIC THAT ITS BID
WAS REJECTED BECAUSE HE HAD DETERMINED THAT IT COULD NOT MEET THE 4-HOUR
DELIVERY REQUIREMENT. BECAUSE METABOLIC HAD NOT BEEN INSPECTED FOR THE
CLEARINGHOUSE SYSTEM OF THE AABB, WHICH WAS NOT MANDATORY, THE
CONTRACTING OFFICER HAVING COGNIZANCE OF THE HOUSTON PROCUREMENT
REQUESTED AN INSPECTION OF ITS FACILITIES PURSUANT TO THE SPECIAL NOTE
UNDER PARAGRAPH 1 QUOTED ABOVE. REJECTION OF METABOLIC'S BID FOR THE
PROCUREMENT AT THE HOUSTON VA HOSPITAL WAS BASED UPON THE INSPECTION
TEAM'S REPORT DATED JUNE 26, 1970, OF METABOLIC'S FACILITIES, WHICH
CONCLUDED THAT METABOLIC'S OPERATIONS DID NOT CONFORM TO THE STANDARDS
OF THE CLEARINGHOUSE SYSTEM OF THE AABB, VA HOSPITAL STANDARDS, OR DONOR
REQUIREMENTS TO BE INCLUDED IN THE CONTRACT.
IN TELEGRAMS DATED JUNE 30, 1970, AND JULY 1, 1970, METABOLIC
PROTESTED REJECTION OF ITS BIDS BY THE RESPECTIVE HOSPITALS TO THE VA IN
WASHINGTON, D.C. IN LETTERS DATED JULY 21 AND 30, 1970, THE DIRECTOR OF
THE SUPPLY SERVICE AFFIRMED REJECTION OF BOTH BIDS ON THE BASIS OF THE
INSPECTION TEAM'S REPORT. METABOLIC PROTESTED FURTHER, STATING THAT
SINCE ITS BIDS HAD BEEN REJECTED FOR REASONS OF CAPACITY IT REQUESTED
ISSUANCE OF CERTIFICATES OF COMPETENCY BY THE SMALL BUSINESS
ADMINISTRATION (SBA). THIS REQUEST, ALONG WITH PERTINENT PARTS OF THE
FILES FROM THE RESPECTIVE HOSPITALS, WAS FORWARDED TO SBA. ON SEPTEMBER
17, 1970, SBA ISSUED CERTIFICATES OF COMPETENCY (COC'S) UNDER BOTH
IFB'S, CERTIFYING THAT METABOLIC WAS COMPETENT AS TO CAPACITY AND CREDIT
TO PERFORM THE PROCUREMENTS COVERED BY THE IFB'S. FURTHERMORE, WE WERE
ADVISED ON DECEMBER 7, 1970, THAT THE COC REVIEW BOARD, DALLAS, TEXAS,
WOULD HAVE ISSUED A COC TO METABOLIC IN MAY OR JUNE 1970 IF ONE HAD BEEN
APPLIED FOR.
WHILE WE RECOGNIZE THAT A CONTRACTING OFFICER'S DETERMINATION OF A
BIDDER'S RESPONSIBILITY INVOLVES THE EXERCISE OF A CONSIDERABLE RANGE OF
DISCRETION WHICH WILL NOT ORDINARILY BE QUESTIONED BY OUR OFFICE, A
CONTRACTING OFFICER'S DETERMINATION OF RESPONSIBILITY OF A SMALL
BUSINESS CONCERN IS SUBJECT TO THE AUTHORITY OF THE SBA UNDER SECTION
8(B)(7) OF THE SMALL BUSINESS ACT, PUBLIC LAW 85-536, 15 U.S.C.
637(B)(7), TO CERTIFY TO GOVERNMENT PROCUREMENT OFFICERS WITH RESPECT TO
THE CAPACITY AND CREDIT OF THE SMALL BUSINESS CONCERN TO PERFORM A
SPECIFIC CONTRACT. SECTION 1-1.708-2(A) OF THE FEDERAL PROCUREMENT
REGULATIONS (FPR) REQUIRES THE CONTRACTING OFFICER TO REFER A SMALL
BUSINESS CONCERN TO THE SBA FOR THE POSSIBLE ISSUANCE OF A COC WHERE THE
BID OF THAT CONCERN IS TO BE REJECTED BECAUSE THE CONCERN HAS BEEN
DETERMINED TO BE NONRESPONSIBLE AS TO CAPACITY OR CREDIT. UNDER THE
TERMS OF THE STATUTORY PROVISION AND FPR 1-1.708-3, PROCUREMENT OFFICERS
ARE REQUIRED TO ACCEPT THE SBA CERTIFICATION AS CONCLUSIVE.
IN HIS REPORT, THE DIRECTOR OF THE SUPPLY SERVICE TAKES THE POSITION
THAT REJECTION OF METABOLIC'S BIDS WITHOUT REFERRAL TO SBA WAS PROPER AS
THE CONTRACTING OFFICER DETERMINED METABOLIC NONRESPONSIBLE FOR REASONS
OTHER THAN CAPACITY OR CREDIT. HE STATES THE "FACTS ARE THAT IT IS
HUMAN BLOOD THAT IS INVOLVED IN THIS CONTRACT AND THAT THE INSPECTION
TEAM, IN ADDITION TO DETECTING DEFICIENCIES IN THE FIRM'S FACILITIES,
HAD DOUBTS ABOUT THE RECORDS IT KEPT AND ITS METHOD OF DRAWING BLOOD."
SECTION 1-1.708-1 OF FPR DEFINES CAPACITY AS THE "OVERALL ABILITY OF
A PROSPECTIVE SMALL BUSINESS CONTRACTOR TO MEET QUALITY, QUANTITY, AND
TIME REQUIREMENTS OF A PROPOSED CONTRACT AND INCLUDES ABILITY TO
PERFORM, ORGANIZATION, EXPERIENCE, TECHNICAL KNOWLEDGE, SKILLS,
'KNOW-HOW,' TECHNICAL EQUIPMENT, AND FACILITIES." IN OTHER WORDS,
"CAPACITY" RELATES TO FACTORS WHICH ARE DETERMINATIVE OF WHETHER A
BIDDER CAN PERFORM IN ACCORDANCE WITH THE TERMS OF THE PROPOSED
CONTRACT. WE HAVE CAREFULLY REVIEWED THE INSPECTION TEAM'S REPORT, AS
WELL AS OTHER DOCUMENTS IN THE CONTRACT FILES, AND ARE UNABLE TO AGREE
WITH THE CONCLUSION THAT THE DEFICIENCIES NOTED THEREIN RELATE TO OTHER
THAN DEFICIENCIES IN CAPACITY AS DEFINED BY FPR. WHEN THE REASONS GIVEN
FOR REJECTION OF METABOLIC'S BIDS ARE EXAMINED IN LIGHT OF THE
DEFINITION OF "CAPACITY" IN FPR 1-1.708-1, WE CANNOT ESCAPE THE
CONCLUSION THAT THESE REASONS RELATE TO DOUBT AS TO METABOLIC'S "OVERALL
ABILITY *** TO MEET QUALITY, QUANTITY, AND TIME REQUIREMENTS."
FURTHERMORE, WE DO NOT BELIEVE THE STATUTORY LIMITATION ON THE
CONTRACTING OFFICER'S AUTHORITY TO DETERMINE THE RESPONSIBILITY OF A
SMALL BUSINESS CONCERN CAN BE OVERCOME BY SIMPLY CONCLUDING THAT THE
REASONS FOR THE CONTRACTING OFFICER'S NEGATIVE DETERMINATION DO NOT
CONNECTION, FPR 1-1.708-2(A)(5) PROVIDES AS FOLLOWS:
"(5) A DETERMINATION BY A CONTRACTING OFFICER THAT A SMALL BUSINESS
CONCERN IS NOT RESPONSIBLE FOR REASONS OTHER THAN DEFICIENCIES IN
CAPACITY OR CREDIT (E.G., LACK OF INTEGRITY, BUSINESS ETHICS, OR
PERSISTENT FAILURE TO APPLY NECESSARY TENACITY OR PERSEVERANCE TO DO AN
ACCEPTABLE JOB) MUST BE SUPPORTED BY SUBSTANTIAL EVIDENCE DOCUMENTED IN
THE CONTRACT FILE AND MUST BE APPROVED IN EACH INSTANCE BY HIGHER
AUTHORITY WITHIN THE AGENCY." THERE IS NO SUCH DOCUMENTATION OR APPROVAL
BY HIGHER AUTHORITY IN THE CONTRACT FILES FURNISHED OUR OFFICE.
SINCE THE CONTRACTING OFFICER'S FAILURE TO FOLLOW THE PROPER
PROCEDURES WAS CONTRARY TO THE REGULATIONS IMPLEMENTING THE SMALL
BUSINESS ACT AND IN CIRCUMVENTION OF THE STATUTORY PURPOSE, WE BELIEVE
THE REJECTION OF THE LOW BIDS SUBMITTED BY METABOLIC WAS IMPROPER. SEE
50 COMP. GEN. ___ (B-168626(1), JULY 30, 1970). THEREFORE, IF METABOLIC
IS WILLING TO ACCEPT THESE CONTRACTS AT THIS POINT AND SBA REVALIDATES
THE COC'S BASED UPON METABOLIC'S CAPACITY AND CREDIT AS OF THE PRESENT
TIME, COMMUNITY'S CONTRACTS SHOULD BE TERMINATED AND AWARDS MADE TO
METABOLIC FOR THE BALANCE OF THE CONTRACT PERIODS.
BEFORE ANY AWARDS ARE MADE TO METABOLIC, HOWEVER, WE BELIEVE IT WOULD
BE ENTIRELY APPROPRIATE FOR YOU TO PRESENT EVIDENCE TO SBA AND REQUEST
THAT IT NOT REVALIDATE THE COC'S ISSUED TO METABOLIC, IF YOU STILL HAVE
SUBSTANTIAL DOUBT AS TO THAT FIRM'S ABILITY TO PERFORM THESE CONTRACTS.
SEE FPR 1-1.708.3. IN THIS CONNECTION, WE NOTE THAT YOUR AGENCY AWARDED
A CONTRACT TO METABOLIC IN SEPTEMBER, 1970 (CONTRACT NO. V674P-39) FOR
HUMAN BLOOD NEEDS AT THE VETERANS ADMINISTRATION HOSPITAL, TEMPLE,
TEXAS, AND IT SEEMS TO US THAT METABOLIC'S PERFORMANCE UNDER THIS
CONTRACT WOULD GIVE AN INDICATION AS TO THE FIRM'S ABILITY TO PERFORM
SUCH CONTRACTS.
B-171674, MAY 4, 1971
CIVILIAN EMPLOYEE - TRAVEL EXPENSES - PARKING FEES
ADVISING THAT MAX C. MCLEAN MAY BE REIMBURSED FOR DAILY PARKING FEES
INCIDENT TO HIS TEMPORARY DUTY ASSIGNMENT AT THE DEPARTMENT OF COMMERCE
BUILDING IN WASHINGTON, D.C.
UNDER SECTION 3.5C(1) OF THE STANDARDIZED GOVERNMENT TRAVEL
REGULATIONS WHEN, AS HERE, REIMBURSEMENT FOR EXPENDITURES ON OFFICIAL
BUSINESS HAS BEEN ADMINISTRATIVELY APPROVED AS ADVANTAGEOUS TO THE
GOVERNMENT AND NO RESTRICTION HAS BEEN PLACED ON ALLOWANCE OF PARKING
FEES, THESE FEES MAY BE REIMBURSED.
TO MR. R. P. HOGAN
YOUR LETTER OF JANUARY 7, 1971, REFERENCE AD571, REQUESTS AN ADVANCE
DECISION AS TO WHETHER THE SUM OF $31.25 FOR TAXI FARE, LOCAL MILEAGE,
AND PARKING FEES CLAIMED ON THE ENCLOSED VOUCHER (STANDARD FORM 1164) BY
MR. MAX C. MCLEAN MAY BE CERTIFIED FOR PAYMENT. THE EXPENSES WERE
ADMINISTRATIVELY APPROVED AS ADVANTAGEOUS TO THE GOVERNMENT, BUT YOU
HAVE SOME DOUBT AS TO THE LEGALITY OF PAYMENT FOR DAILY PARKING FEES
TOTALING $22.00 INCIDENT TO MR. MCLEAN'S TEMPORARY DUTY ASSIGNMENT AT
THE DEPARTMENT OF COMMERCE BUILDING, WASHINGTON, D.C. YOU STATE THAT
THE REMAINDER OF THE CLAIM AMOUNTING TO $9.25 FOR MILEAGE AND TAXI FARE
APPEARS TO BE PROPER AND YOU HAVE NO QUESTION AS TO PAYMENT THEREFOR.
MR. MCLEAN'S HEADQUARTERS AND NORMAL DUTY AS AN ASSISTANT TO THE
DIRECTOR OF HYDROGRAPHY AND OCEANOGRAPHY WERE AT THE WASHINGTON SCIENCE
CENTER (BUILDING "WSC 1"), ROCKVILLE, MARYLAND, AND FREE PARKING SPACE
WAS AVAILABLE THERE DAILY. DURING THE 11 DAYS COVERED BY THE CLAIM THE
EMPLOYEE WAS DETAILED TO DUTY AT THE DEPARTMENTAL BUILDING IN
WASHINGTON. YOUR DOUBT IN THE MATTER ARISES FOR THE REASON YOUR INTERNAL
REGULATIONS ARE SILENT WITH RESPECT TO PARKING FEES AND YOU ARE UNABLE
TO LOCATE AN APPROPRIATE DECISION RELATING TO SUCH PAYMENTS.
SECTION 3.5C(1) OF THE STANDARDIZED GOVERNMENT TRAVEL REGULATIONS
PROVIDES THAT OFFICERS AND EMPLOYEES SHALL, WHENEVER SUCH MODE OF
TRANSPORTATION IS AUTHORIZED OR APPROVED AS ADVANTAGEOUS TO THE
GOVERNMENT, BE PAID MILEAGE FOR THE USE OF PRIVATELY OWNED AUTOMOBILES
WHEN ENGAGED IN OFFICIAL BUSINESS WITHIN OR OUTSIDE THEIR DESIGNATED
POSTS OF DUTY. AUTHORITY IS ALSO PROVIDED THEREIN FOR REIMBURSEMENT OF
PARKING FEES UNLESS THE TRAVEL ORDER OR OTHER DETERMINATION RESTRICTS
THEIR ALLOWANCE. THE REGULATION LEAVES IT WITHIN THE DISCRETION OF THE
ADMINISTRATIVE OFFICE WHETHER TO APPROVE OR DISAPPROVE PAYMENTS
THEREUNDER WHEN AN EMPLOYEE IS REQUIRED TO PERFORM DUTIES AT A NEARBY
TEMPORARY DUTY STATION. SEE B-166472, MAY 14, 1969; B-163704, APRIL 1,
1968; 32 COMP. GEN. 235 (1952).
SINCE THE CLAIM FOR REIMBURSEMENT FOR EXPENDITURES ON OFFICIAL
BUSINESS HAS BEEN ADMINISTRATIVELY APPROVED AS ADVANTAGEOUS TO THE
GOVERNMENT, AND NO ADMINISTRATIVE RESTRICTION HAS BEEN PLACED UPON
ALLOWANCE OF PARKING FEES, THE VOUCHER IS RETURNED HEREWITH AND MAY BE
CERTIFIED FOR PAYMENT.
B-171766, MAY 4, 1971
MILITARY PERSONNEL - CHANGE OF STATION - BASIC QUARTERS ALLOWANCE
ADVISING THAT LT. KELLY W. CARTRON IS ENTITLED TO BASIC QUARTERS
ALLOWANCE FOR A PERIOD OF 30 DAYS INCIDENT TO HIS CHANGE OF STATION TO
BEALE AFB, CALIFORNIA.
UPON ARRIVAL AT BEALE AFB, LT. CARTRON OCCUPIED VISITING OFFICERS
QUARTERS (A TRANSIENT BILLETING FACILITY) ON SPACE AVAILABLE BASIS
BECAUSE PERMANENT BACHELOR QUARTERS WERE NOT YET AVAILABLE. HE OCCUPIED
THESE QUARTERS FOR SHORT PERIODS OF TIME BEING AWAY FROM HIS NEW STATION
ON TEMPORARY DUTY ASSIGNMENTS UNTIL NOVEMBER 12, WHEN HE ESTABLISHED
PRIVATE OFFBASE QUARTERS. UNDER THESE CIRCUMSTANCES HIS ENTITLEMENT TO
BASIC QUARTERS ALLOWANCE IS LIMITED BY EXPRESS LANGUAGE OF STATUTE (37
U.S. C. 403) AND EXECUTIVE ORDER (NO. 11157) TO THE FIRST 30 DAYS (NOT
NECESSARILY CONTINUOUS) PRIOR TO OCCUPANCY OF PERMANENT QUARTERS DURING
WHICH TRANSIENT TYPE QUARTERS WERE ACTUALLY OCCUPIED.
TO CAPTAIN R. V. PEACOCK, USAF:
FURTHER REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 20, 1970, IN
WHICH YOU REQUESTED AN ADVANCE DECISION CONCERNING THE ENTITLEMENT OF
FIRST LIEUTENANT KELLY W. CARTRON TO PAYMENT OF BASIC ALLOWANCE FOR
QUARTERS (BAQ) UNDER THE CIRCUMSTANCES DESCRIBED THEREIN. YOUR REQUEST
WAS ASSIGNED AIR FORCE REQUEST NO. DO-AF-1109 BY THE DEPARTMENT OF
DEFENSE MILITARY PAY AND ALLOWANCE COMMITTEE.
YOU REPORT THAT ON APRIL 18, 1970, LIEUTENANT CARTRON ARRIVED AT
BEALE AIR FORCE BASE, CALIFORNIA, PURSUANT TO PERMANENT CHANGE OF
STATION (PCS) ORDERS; THAT PERMANENT BACHELOR OFFICERS QUARTERS (BOQ)
AT THAT PLACE WERE NOT THEN AVAILABLE; AND THAT HE WAS AUTHORIZED TO
LIVE OFF-BASE WITH ENTITLEMENT TO BAQ FOR A PERIOD OF NOT TO EXCEED 90
DAYS EFFECTIVE APRIL 20, 1970. THE BILLETING OFFICER APPARENTLY ADVISED
HIM THAT HE COULD OCCUPY THE VISITING OFFICERS QUARTERS (VOQ), A
TRANSIENT BILLETING FACILITY, ON A SPACE-AVAILABLE BASIS. WHILE HE
OCCUPIED SUCH VOQ FOR SHORT PERIODS OF TIME, HE WAS AWAY FROM HIS NEW
STATION ON TEMPORARY DUTY ASSIGNMENTS OR IN A LEAVE STATUS MOST OF THE
TIME UNTIL HIS RETURN ON OCTOBER 2, 1970, WHEN HE AGAIN OCCUPIED
QUARTERS AT THE TRANSIENT FACILITY. HE ESTABLISHED PRIVATE OFF-BASE
QUARTERS IN THE VICINITY OF BEALE AIR FORCE BASE ON NOVEMBER 12, 1970.
AT EACH OF HIS THREE TEMPORARY DUTY STATIONS HE OCCUPIED GOVERNMENT
TRANSIENT QUARTERS.
UNDER THESE CIRCUMSTANCES AND IN LIGHT OF OUR DECISIONS 45 COMP.
GEN. 245 (1965), 45 ID. 347 (1965), AND 48 ID. 40 (1968), AS WELL AS
RULES 13 AND 14 OF TABLE 3-2-3, DEPARTMENT OF DEFENSE MILITARY PAY AND
ALLOWANCES ENTITLEMENTS MANUAL, YOU POSE THE FOLLOWING QUESTIONS:
"(1) IS LIEUTENANT CARTRON ENTITLED TO BAQ BEGINNING 18 APRIL 1970?
"(2) IF QUESTION (1) IS ANSWERED IN THE AFFIRMATIVE, WOULD LIEUTENANT
CARTRON'S BAQ ENTITLEMENT CEASE WHEN HE DEPARTED FOR TEMPORARY DUTY AT
ANOTHER AIR FORCE BASE WHERE HE OCCUPIED TRANSIENT TYPE GOVERNMENT
QUARTERS?
"(3) IF ANSWER TO QUESTION (2) IS AFFIRMATIVE, WOULD LIEUTENANT
CARTRON'S BAQ ENTITLEMENT BE REESTABLISHED UPON HIS RETURN TO HIS
PERMANENT STATION WHERE HE AGAIN OCCUPIED TRANSIENT TYPE QUARTERS? IF
ANSWER TO QUESTION (2) IS NEGATIVE, AT WHAT POINT WOULD LIEUTENANT
CARTRON'S ENTITLEMENT CEASE?
"(4) IF ANSWER TO THE FIRST PART OF QUESTION (3) IS AFFIRMATIVE,
WOULD LIEUTENANT CARTRON'S ENTITLEMENT TO BAQ CEASE AT THE END OF THIRTY
DAYS, SAID THIRTY DAYS BEING COMPUTED FROM THE TIME HE ORIGINALLY
ARRIVED PCS (18 APRIL 1970)?"
PARAGRAPH 403, TITLE 37 U.S. CODE, PROVIDES IN PERTINENT PART AS
FOLLOWS:
"(A) EXCEPT AS OTHERWISE PROVIDED BY THIS SECTION OR BY ANOTHER LAW,
A MEMBER OF A UNIFORMED SERVICE WHO IS ENTITLED TO BASIC PAY IS ENTITLED
TO A BASIC ALLOWANCE FOR QUARTERS *** .
"(B) *** A MEMBER OF A UNIFORMED SERVICE WHO IS ASSIGNED TO QUARTERS
OF THE UNITED STATES OR A HOUSING FACILITY UNDER THE JURISDICTION OF A
UNIFORMED SERVICE, APPROPRIATE TO HIS GRADE, *** AND ADEQUATE FOR
HIMSELF, *** IS NOT ENTITLED TO A BASIC ALLOWANCE FOR QUARTERS. ***
"(F) A MEMBER OF A UNIFORMED SERVICE WITHOUT DEPENDENTS WHO IS IN PAY
GRADE E-4 (FOUR OR MORE YEARS' SERVICE) OR ABOVE, IS ENTITLED TO A BASIC
ALLOWANCE FOR QUARTERS WHILE HE IS IN A TRAVEL OR LEAVE STATUS BETWEEN
PERMANENT DUTY STATIONS, INCLUDING TIME GRANTED AS DELAY EN ROUTE OR
PROCEED TIME, WHEN HE IS NOT ASSIGNED TO QUARTERS OF THE UNITED STATES."
"(G) THE PRESIDENT MAY PRESCRIBE REGULATIONS FOR THE ADMINISTRATION
OF THIS SECTION, *** "
THE PRESIDENTIAL REGULATIONS ARE CONTAINED IN SECTION 403 OF
EXECUTIVE ORDER NO. 11157, AS AMENDED BY EXECUTIVE ORDER NO. 11511, IN
PERTINENT PART, AS FOLLOWS:
"SEC. 403. ANY QUARTERS OR HOUSING FACILITIES UNDER THE JURISDICTION
OF ANY OF THE UNIFORMED SERVICES IN FACT OCCUPIED WITHOUT PAYMENT OF
RENTAL CHARGES *** BY A MEMBER WITHOUT DEPENDENTS *** SHALL BE DEEMED TO
HAVE BEEN ASSIGNED TO SUCH MEMBER AS APPROPRIATE AND ADEQUATE QUARTERS
AND NO BASIC ALLOWANCE FOR QUARTERS SHALL ACCRUE TO SUCH MEMBER UNDER
SUCH CIRCUMSTANCES UNLESS THE OCCUPANCY (I) OCCURS WHILE SUCH MEMBER IS
IN A DUTY OR LEAVE STATUS INCIDENT TO A CHANGE OF PERMANENT STATION AND
IS OF A TEMPORARY NATURE UNDER STANDARDS PRESCRIBED BY REGULATIONS
ISSUED BY THE SECRETARY OF DEFENSE IN THE CASE OF MEMBERS OF THE ARMY,
NAVY, AIR FORCE, OR MARINE CORPS, AND THE RESERVE COMPONENTS THEREOF.
*** "
IMPLEMENTING ADMINISTRATIVE REGULATIONS ISSUED PURSUANT TO PARAGRAPH
407 OF EXECUTIVE ORDER NO. 11157 ARE INCORPORATED IN RULE 14, TABLE
3-2-3. DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCES ENTITLEMENTS
MANUAL, WHICH PROVIDES THAT A MEMBER OF THE UNIFORMED SERVICES WHO "IS
ASSIGNED PCS AND IS ON AUTHORIZED LEAVE OR DUTY AT THE OLD OR NEW
STATION" IS ENTITLED TO A BASIC ALLOWANCE FOR QUARTERS "FOR NOT MORE
THAN 30 DAYS" THAT HE "OCCUPIES TRANSIENT TYPE GOVERNMENT QUARTERS AT
ANY ONE LOCATION."
WHILE GOVERNMENT QUARTERS WERE NOT ACTUALLY ASSIGNED TO LIEUTENANT
CARTRON AT HIS NEW STATION. BEALE AIR FORCE BASE, HE OCCUPIED TRANSIENT
TYPE QUARTERS WHENEVER HE WAS THERE PRIOR TO NOVEMBER 12, 1970. IN
THOSE CIRCUMSTANCES HIS ENTITLEMENT TO BASIC ALLOWANCE FOR QUARTERS IS
LIMITED BY THE EXPRESS LANGUAGE OF THE STATUTE, EXECUTIVE ORDER AND
ADMINISTRATIVE REGULATIONS TO A PERIOD OF 30 DAYS AT ONE LOCATION.
WHILE THE QUARTERS ALLOWANCE CREDIT ACCRUES ON THE BASIS OF OCCUPANCY OF
TRANSIENT TYPE GOVERNMENT QUARTERS AT THE SAME LOCATION, NEITHER THE LAW
NOR THE REGULATIONS REQUIRE THAT THE 30-DAY PERIOD BE CONTINUOUS.
CONSEQUENTLY, WHEN, AS IN THIS CASE, THE OCCUPANCY OF SUCH QUARTERS IS
INTERRUPTED BY LEAVE AND TEMPORARY DUTY, THE BASIC ALLOWANCE FOR
QUARTERS ACCRUES FOR NOT TO EXCEED THE FIRST 30 DAYS PRIOR TO THE
OCCUPANCY OF PERMANENT QUARTERS DURING WHICH TRANSIENT TYPE QUARTERS ARE
IN FACT OCCUPIED AT THE PERMANENT STATION.
THIS 30-DAY QUARTERS ALLOWANCE ENTITLEMENT ACCRUES UNDER THE
ABOVE-QUOTED PROVISIONS OF EXECUTIVE ORDER NO. 11157 BY VIRTUE OF
LIEUTENANT CARTRON'S OCCUPANCY OF TRANSIENT TYPE QUARTERS INCIDENT TO
HIS ORDERED CHANGE OF PERMANENT STATION AND DOES NOT RESULT FROM THE
FACT THAT HE WAS NOT ASSIGNED QUARTERS AT HIS NEW PERMANENT STATION.
CONSEQUENTLY, PRIOR TO NOVEMBER 12, 1970, THE DATE ON WHICH HE FIRST
OCCUPIED OFF-BASE QUARTERS, LIEUTENANT CARTRON WAS NOT "RECEIVING BAQ AT
HIS PERMANENT STATION" SO AS TO BRING HIM WITHIN THE PURVIEW OF RULE 13
OF TABLE 3-2-3 OF THE DEPARTMENT OF DEFENSE MILITARY PAY AND ALLOWANCES
ENTITLEMENTS MANUAL PROVIDING FOR A CONTINUANCE OF THE BASIC ALLOWANCE
FOR QUARTERS DURING PERIODS OF TEMPORARY DUTY AWAY FROM A PERMANENT
STATION.
YOUR FOUR QUESTIONS ARE ANSWERED IN THE AFFIRMATIVE. THE MILITARY
PAY ORDER FORWARDED WITH YOUR LETTER IS RETURNED HEREWITH PAYMENT BEING
AUTHORIZED THEREON TO THE EXTENT INDICATED ABOVE.
B-171807, MAY 4, 1971
BID PROTEST - CONTRACT HELD FOR SIMILAR WORK - UNFAIR ADVANTAGE
DECISION DENYING PROTEST BY SECOND LOW BIDDER AGAINST AWARD OF
CONTRACT TO UNITED SERVICE CORPORATION, LOW BIDDER, UNDER AN IFB ISSUED
BY PATRICK AFB, FOR INSTALLATION OF GOVERNMENT FURNISHED HEAT PUMPS,
REPOSITION OF OTHER HEAT PUMPS AND REPAIR OF CONDENSATE DRAINS.
WHILE UNITED IS ALREADY PERFORMING A MAINTENANCE CONTRACT TO KEEP IN
REPAIR APPROXIMATELY 820 FAMILY HOUSING BUILDINGS, INCLUDING REPAIR AND
REPLACEMENT OF HEAT PUMPS THE COMP. GEN. BELIEVES THAT CONTRACT
PROVISIONS PREVENT AN UNFAIR ADVANTAGE BY REQUIRING THAT EMPLOYEES UNDER
THE MAINTENANCE CONTRACT (WHICH HAS NO PRESCRIBED MINIMUM LABOR RATES)
WILL NOT PERFORM WORK ON THE INSTALLATION CONTRACT AT RATES LESS THAN
PRESCRIBED IN THE LATTER. FURTHER THE COMP. GEN. FINDS THAT UNITED HAD
NO UNFAIR ADVANTAGE BECAUSE IT WAS NOT FURNISHED SPECIFICATIONS,
DRAWINGS, OR ANY OTHER INFORMATION PRIOR TO ISSUANCE OF THE INVITATION.
ACCORDINGLY THE PROTEST IS DENIED.
TO GREEN ELECTRIC:
REFERENCE IS MADE TO YOUR LETTERS DATED JANUARY 27 AND MARCH 2, 1971,
PROTESTING AN AWARD TO UNITED SERVICE CORPORATION, UNDER INVITATION FOR
BIDS (IFB) F08650-71-B-0027, ISSUED BY PATRICK AIR FORCE BASE, FLORIDA.
THE INVITATION FOR BIDS WAS ISSUED ON NOVEMBER 13, 1970, FOR THE
INSTALLATION OF 218 GOVERNMENT-FURNISHED HEAT PUMPS AND ASSOCIATED WORK
NECESSARY FOR THESE INSTALLATIONS. IN ADDITION, THE IFB REQUIRED THE
SUCCESSFUL BIDDER TO REPOSITION 20 EXISTING HEAT PUMPS AND REPAIR AN
ESTIMATED 100 CONDENSATE DRAINS. OPTION QUANTITIES WERE ALSO SET FORTH
IN THE IFB FOR CONSIDERATION IN THE AWARD EVALUATION. THE BASIC WORK IS
TO BE COMPLETED WITHIN 160 CALENDAR DAYS AFTER RECEIPT OF NOTICE TO
PROCEED. THE OPTION QUANTITY MUST BE EXERCISED WITHIN 150 DAYS AFTER
THE NOTICE TO PROCEED, EXTENDING THE COMPLETION DATE TO 280 CALENDAR
DAYS AFTER RECEIPT OF NOTICE TO PROCEED.
THE BIDS WERE OPENED ON DECEMBER 18, 1970, AND IT WAS DETERMINED THAT
UNITED SERVICE CORPORATION (UNITED) WAS THE LOW RESPONSIVE AND
RESPONSIBLE BIDDER AT $78,880.65 (INCLUDING OPTION) AND YOUR FIRM WAS
NEXT LOW AT $115,552.44 (INCLUDING OPTION). AWARD WAS MADE TO UNITED ON
JANUARY 25, 1971.
YOU POINT OUT THAT UNITED IS ALREADY PERFORMING A CONTRACT TO
MAINTAIN AND KEEP IN REPAIR APPROXIMATELY 820 FAMILY HOUSING BUILDINGS
AT PATRICK AIR FORCE BASE, INCLUDING REPAIR AND REPLACEMENT OF HEAT
PUMPS. YOU CONTEND THAT UNITED COULD PERFORM THE WORK REQUIRED ON THE
CONTRACT AT ISSUE, WHICH INCLUDES PREVAILING WAGE RATES REPRESENTING THE
MINIMUM WHICH MAY BE PAID TO GIVEN CATEGORIES OF WORKMEN, UTILIZING
LABOR HIRED FOR THE MAINTENANCE CONTRACT WHICH HAS NO PRESCRIBED MINIMUM
LABOR RATES AND FOR WHICH ACTUAL LABOR RATES WOULD PRESUMABLY BE LOWER.
THE INSTALLATION CONTRACT PROVIDES FOR A DEFINITE NUMBER OF UNITS TO
BE INSTALLED FOR A SPECIFIC NUMBER OF RESIDENCES. IF UNITED INSTALLS
ANY HEAT PUMPS UNDER THE MAINTENANCE CONTRACT, IT MUST SET FORTH THE
TIME OF INSTALLATION AND THE ADDRESS AT WHICH THE HEAT PUMP WAS
INSTALLED. THE INSTALLATION CONTRACT ALSO REQUIRES THE CONTRACTOR TO
POST A COPY OF THE APPLICABLE WAGE RATES AT THE SITE OF THE WORK IN A
PROMINENT PLACE AND TO SUBMIT WEEKLY TO THE CONTRACTING OFFICER A COPY
OF ALL PAYROLLS. IN ADDITION, THE CONTRACTING OFFICER HAS ACCESS TO ALL
OF THE RECORDS OF THE CONTRACTOR WITH REGARD TO SUCH PAYMENT. IT MUST
ALSO BE NOTED THAT SIGNIFICANT PENALTIES ARE PROVIDED IN THE CASE OF
VIOLATION OF THESE PROVISIONS. WE BELIEVE THAT THESE REQUIREMENTS
PROVIDE AN ADEQUATE BASIS FOR INSURING THAT EMPLOYEES UNDER THE
MAINTENANCE CONTRACT WILL NOT PERFORM WORK ON THE INSTALLATION CONTRACT
AT RATES LESS THAN PRESCRIBED IN THE LATTER.
YOU FURTHER CONTEND THAT THE STANDARD WORKMANSHIP GUARANTEE OF THE
INSTALLATION CONTRACT MAY CONFLICT WITH THE EXISTING MAINTENANCE
CONTRACT. UNDER THE APPROPRIATE "INSPECTION" PROVISION OF THE CONTRACT,
THE GOVERNMENT CAN REQUIRE THE CONTRACTOR TO REPLACE WITHOUT CHARGE ANY
MATERIAL OR CORRECT ANY WORKMANSHIP NOT IN CONFORMANCE WITH THE CONTRACT
REQUIREMENTS. AGAIN, THIS IS A MATTER OF CONTRACT ADMINISTRATION TO
MAKE SURE THAT ANY CORRECTION WORK UNDER THE INSTALLATION CONTRACT IS
PERFORMED BY EMPLOYEES IN ACCORDANCE WITH THE TERMS OF THE INSTALLATION
CONTRACT AND NOT UNDER THE TERMS OF THE MAINTENANCE CONTRACT. THE
MAINTENANCE CONTRACT IS ALSO A FIRM FIXED-PRICE CONTRACT (BUT WITH AN
ESTIMATED AMOUNT FOR EMERGENCY PURCHASES OF MATERIALS AND SUPPLIES WHICH
ARE NOT GOVERNMENT-FURNISHED). IT SHOULD BE NOTED THAT WHILE THE
MAINTENANCE CONTRACT DOES INCLUDE A REQUIREMENT FOR REPLACEMENT OF AIR
CONDITIONING UNITS, THE BIDDERS WERE ADVISED (PAGE 11 OF THE IFB) THAT
REPLACEMENT OF SEVERAL HUNDRED NEW UNITS BY SEPARATE CONTRACT IN FISCAL
YEAR 1970 WAS CONTEMPLATED.
YOU ALSO CLAIM THAT THE CONTRACTOR IS IN A POSITION TO UTILIZE
VEHICLES, FACILITIES, SUPPLIES, EQUIPMENT, AND PERSONNEL IN PERFORMANCE
OF THE WORK UNDER THE INSTALLATION CONTRACT FOR WHICH IT IS BEING
REIMBURSED UNDER THE MAINTENANCE CONTRACT. THE MAINTENANCE CONTRACT HAS
NO PROVISION FOR GOVERNMENT-FURNISHED VEHICLES. ALTHOUGH THE GOVERNMENT
WILL FURNISH CERTAIN SUPPLIES AND MATERIALS TO THE CONTRACTOR UNDER THE
MAINTENANCE CONTRACT, THE FURNISHING OF THESE SUPPLIES AND MATERIALS IS
SUBJECT TO RIGID CONTROL AND ACCOUNTING BY THE ADMINISTRATIVE
CONTRACTING OFFICER.
THE FACT THAT UNITED HAS NOT SUBMITTED A BID FOR VARIOUS OTHER
PROJECTS AT PATRICK AIR FORCE BASE DOES NOT, IN OUR OPINION, INDICATE AS
YOU IMPLY, THAT THERE WAS ANY IMPROPRIETY IN THE SUBMISSION OF ITS BID
OR IN AWARD TO IT OF THE INSTALLATION CONTRACT.
THE AIR FORCE CONFIRMS THAT A RETIRED CIVIL SERVICE EMPLOYEE IS
EMPLOYED BY THE CONTRACTOR. FURTHER, THIS MATTER WAS PREVIOUSLY
INVESTIGATED BY THE AIR FORCE AND IT WAS DETERMINED THAT NO CONFLICT OF
INTEREST WAS INVOLVED. WE SEE NO REASON TO QUESTION THIS DETERMINATION.
WITH REGARD TO THE CONTENTION THAT UNITS WERE DELIVERED BY THE
CONTRACTOR PRIOR TO ISSUANCE OF NOTICE TO PROCEED, CONTRARY TO THE
CONTRACT, IT IS REPORTED THAT ONE UNIT WAS ISSUED AFTER NOTICE OF AWARD
AND WAS LOADED, DELIVERED AND UNLOADED BY THE CONTRACTOR. THE
CONTRACTOR REQUESTED ISSUANCE OF THIS UNIT FOR THE SOLE PURPOSE OF
OBTAINING MEASUREMENTS FOR THE ACQUISITION OF INSTALLATION MATERIALS
UNDER THE CONTRACT.
WITH REGARD TO YOUR CONTENTION THAT UNITED AS CONTRACTOR UNDER THE
MAINTENANCE CONTRACT HAD AN UNFAIR ADVANTAGE, THE AIR FORCE POINTS OUT
THAT THE INVITATION FOR THE INSTALLATION CONTRACT INVITED PROSPECTIVE
BIDDERS TO VIEW THE UNITS AND VISIT THE SITE PRIOR TO BIDDING. FURTHER,
IT IS REPORTED THAT THE CONTRACTOR WAS NOT FURNISHED SPECIFICATIONS,
DRAWINGS, OR ANY OTHER INFORMATION PRIOR TO ISSUANCE OF THE INVITATION.
IN THESE CIRCUMSTANCES, WE SEE NO BASIS UPON WHICH OUR OFFICE MAY
PROPERLY DISTURB THE CONTRACT AWARDED TO UNITED SERVICE CORPORATION.
B-171822, MAY 4, 1971
CONTRACTS - DISPUTES CLAUSE - ADMINISTRATIVE REMEDIES
ADVISING THAT SEECO'S LETTER TRANSMITTED THROUGH CONGRESSMAN ALPHONZO
BELL ALLEGES MATTERS THAT MAY NOT BE CONSIDERED UNDER GAO'S BID PROTEST
PROCEDURES AT THIS TIME.
BECAUSE SEECO'S ALLEGATIONS INVOLVE DISPUTES OF FACT RELATING TO ITS
PERFORMANCE UNDER CONTRACTS WITH THE NAVAL ORDNANCE STATION, INDIAN
HEAD, MARYLAND, SEECO MUST FIRST SEEK RELIEF UNDER THE "DISPUTES" CLAUSE
OF THE CONTRACTS. UPON THE COMPLETION OF THIS ADMINISTRATIVE PROCESS,
GAO MAY THEN BE REQUESTED TO REVIEW THE MATTER UNDER THE STANDARDS
PRESCRIBED IN 41 U.S.C. 321 AND 322.
TO SEECO, INC:
REFERENCE IS MADE TO YOUR LETTER R1215 JLW, DATED JANUARY 27, 1971,
WITH ENCLOSURES, WHICH WAS TRANSMITTED TO OUR OFFICE BY CONGRESSMAN
ALPHONZO BELL FOR CONSIDERATION UNDER OUR BID PROTEST PROCEDURES.
AFTER REVIEWING THE ABOVE LETTER AND THE ADMINISTRATIVE REPORT WHICH
WE RECEIVED FROM THE DEPARTMENT OF THE NAVY, WE ARE OF THE OPINION THAT
THE MATTERS SEECO ALLEGES MAY NOT BE CONSIDERED UNDER OUR BID PROTEST
PROCEDURES SINCE THEY INVOLVE DISPUTES OF FACT RELATING TO SEECO'S
PERFORMANCE UNDER CONTRACTS WITH THE NAVAL ORDNANCE STATION, INDIAN
HEAD, MARYLAND, FOR AFT HANGERS. ANY RELIEF TO WHICH SEECO MAY BE
ENTITLED UNDER THE CIRCUMSTANCES MUST BE ASSERTED UNDER THE "DISPUTES"
CLAUSE OF THE CONTRACTS. IN THIS CONNECTION, WE STATED IN B-170805,
SEPTEMBER 29, 1970:
"IT APPEARS THAT THE DISPUTE INVOLVED CLEARLY ARISES UNDER THE
CONTRACT AND AS SUCH IS FOR SETTLEMENT PURSUANT TO THE PROCEDURES SET
OUT IN THE 'DISPUTES' CLAUSE WHICH IS CONTAINED IN STANDARD GOVERNMENT
CONTRACTS. IN THAT REGARD, SUCH DISPUTES ARE TO BE DECIDED BY THE
CONTRACTING OFFICER, WITH THE CONTRACTOR HAVING A RIGHT TO APPEAL FROM
SUCH DECISION TO THE HEAD OF THE AGENCY CONCERNED. BOTH THE CONTRACTOR
AND THE GOVERNMENT ARE BOUND TO FOLLOW THE PROCEDURE SET OUT IN THE
CONTRACT FOR THE ADMINISTRATION OF DISPUTES ARISING OUT OF THE CONTRACT,
AND THE CONTRACTOR MUST EXHAUST ITS ADMINISTRATIVE REMEDIES UNDER THE
DISPUTES CLAUSE BEFORE APPEALING EITHER TO OUR OFFICE OR THE COURTS.
SEE B. H. DEACON CO. V UNITED STATES, 189 F. SUPP. 146 (1960); HAPPEL V
UNITED STATES, 176 F. SUPP. 787 (1959), AFFIRMED 279 F. 2D 88 (1960);
AUTOMATIC SCREW PRODUCTS COMPANY V UNITED STATES, 145 CT. CL. 94 (1959);
37 COMP. GEN. 568 (1958) AND AUTHORITIES CITED THEREIN."
SHOULD SEECO BE UNSUCCESSFUL IN ANY CLAIM IT PRESENTS UNDER THE
DISPUTES PROCEDURES AND IT BELIEVES, UPON COMPLETION OF THE
ADMINISTRATIVE PROCESS SET OUT BY THE "DISPUTES" CLAUSE, THAT THE
ADMINISTRATIVE DECISION IS ERRONEOUS IN POINT OF LAW OR FACT, OUR OFFICE
MAY THEN BE REQUESTED TO REVIEW THE MATTER UNDER THE STANDARDS
PRESCRIBED IN 41 U.S.C. 321 AND 322.
B-171844, MAY 4, 1971
BID PROTEST - BID RESPONSIVENESS - UNSOLICITED DESCRIPTIVE DATA
DENIAL OF PROTEST OF MARSHALL RESEARCH & DEVELOPMENT CORP., AGAINST
THE DETERMINATION BY THE CONTRACTING OFFICER THAT ITS LOW BID WAS
NONRESPONSIVE TO THE IFB ISSUED BY THE NAVAL AIR STATION, PATUXENT
RIVER, MD., FOR VIBRATION TEST MACHINE.
LITERATURE FURNISHED WITH A BID DESCRIBING ITEMS NOT CONFORMING TO
THE SPECIFICATIONS, WITHOUT ANY INDICATION OF INTENT THAT THE LITERATURE
DID NOT QUALIFY THE BID, CAST SUCH DOUBT ON THE BIDDER'S INTENTION THAT
THE BID MUST BE REJECTED AS NONRESPONSIVE.
TO MARSHALL RESEARCH AND DEVELOPMENT CORPORATION:
REFERENCE IS MADE TO YOUR TELEGRAM DATED FEBRUARY 4, 1971, AND YOUR
LETTERS DATED FEBRUARY 6 AND FEBRUARY 12, 1971, IN WHICH YOU PROTEST THE
DETERMINATION BY THE CONTRACTING OFFICER THAT YOUR FIRM'S BID WAS
NONRESPONSIVE TO INVITATION FOR BIDS NO. N00421-71-B-0030, ISSUED BY
THE NAVAL AIR STATION, PATUXENT RIVER, MARYLAND, ON DECEMBER 3, 1970,
FOR A VIBRATION TEST MACHINE IN ACCORDANCE WITH DESIGNATED
SPECIFICATIONS.
AT BID OPENING ON JANUARY 6, 1971, IT WAS FOUND THAT THE LOW BID,
SUBMITTED BY YOUR FIRM, INCLUDED AN UNSOLICITED BROCHURE CONSISTING OF
PICTURES, DETAILED SCHEMATICS, DEFINITIVE SPECIFICATIONS AND A DETAILED
EXPLANATION OF THE OPERATION OF YOUR MRAD LINE OF AGREE SHAKERS.
HOWEVER, NO EXPLANATORY LETTER ACCOMPANIED THE BID. ON PAGE 7 OF THE
BID, IT WAS STATED THAT YOU WERE PROPOSING TO FURNISH THE ITEM FROM
STOCK. THE CONTRACTING OFFICER THEREFORE EVALUATED YOUR BID BASED ON
THE LITERATURE FURNISHED AND HE DETERMINED THAT THE MODELS DESCRIBED IN
YOUR LITERATURE COULD NOT COMPLY WITH THE ADVERTISED SPECIFICATIONS
WITHOUT MODIFICATION. FOR EXAMPLE, THE MODELS DESCRIBED IN THE
LITERATURE SHOW A MAXIMUM ACCELERATION OF 3.2G AS OPPOSED TO A
SPECIFICATION REQUIREMENT OF 10G. CONSEQUENTLY, THE CONTRACTING OFFICER
CONCLUDED THAT YOUR BID WAS NONRESPONSIVE.
YOU STATE IN A LETTER AND TELEGRAM OF JANUARY 22, 1971, SENT AFTER
OPENING, THAT THE MATERIAL SUBMITTED WITH THE BID WAS INTENDED TO SHOW
TECHNICAL CAPABILITY ONLY AND NOT TO QUALIFY THE BID. THE
COMMUNICATIONS FURTHER STATE THAT YOU TOOK NO EXCEPTION TO THE
SPECIFICATIONS. YOU APPARENTLY CONCEDE THAT THE SHAKERS DESCRIBED IN
THE LITERATURE ACCOMPANYING YOUR BID DO NOT IN FACT MEET THE
SPECIFICATIONS.
YOU CONTEND THAT NO EVIDENCE EXISTS TO INDICATE THAT THE UNSOLICITED
DESCRIPTIVE LITERATURE WAS IN ANY WAY INTENDED TO QUALIFY THE BID. TO
SUPPORT YOUR POSITION, YOU CITE ASPR 2-202.5(F) WHICH STATES AS FOLLOWS:
"UNSOLICITED DESCRIPTIVE LITERATURE. IF THE FURNISHING OF
DESCRIPTIVE LITERATURE IS NOT REQUIRED BY THE INVITATION FOR BIDS, BUT
SUCH LITERATURE IS FURNISHED WITH A BID, IT WILL NOT BE CONSIDERED AS
QUALIFYING THE BID, AND WILL BE DISREGARDED, UNLESS IT IS CLEAR FROM THE
BID OR ACCOMPANYING PAPERS THAT IT WAS THE BIDDER'S INTENTION SO TO
QUALIFY THE BID."
THE ISSUE HERE, IS WHETHER IT REASONABLY APPEARS THAT THE ENCLOSURES
TO YOUR BID WERE INTENDED TO QUALIFY IT. OBVIOUSLY, YOUR STATEMENTS
AFTER BID OPENING CANNOT HAVE ANY EFFECT ON THE RESPONSIVENESS OF YOUR
BID. IN B-169480, MAY 26, 1970, WE STATED:
"IN SITUATIONS WHERE A BIDDER ACCOMPANIES HIS BID WITH UNSOLICITED
MATERIAL WHICH ON ITS FACE QUALIFIES THE BID, THE BID MAY BE ACCEPTED
ONLY WHERE THE EVIDENCE CLEARLY ESTABLISHES THAT THE BIDDER INTENDED TO
CONFORM TO THE SPECIFICATIONS. OUR OFFICE HAS IN THE PAST REJECTED THE
ARGUMENT THAT AN OVERALL OFFER TO CONFORM, PER SE, CURES SPECIFIC
DEVIATIONS. SEE 36 COMP. GEN. 415 (1956); 40 ID. 132 (1960); AND 46
ID. 1 (1966). THE OVERALL OFFER TO CONFORM TO THE SPECIFICATIONS, IN
WHATEVER FORM, CAN CURE A SPECIFIC DEVIATION ONLY IN SITUATIONS WHERE
THAT PROMISE OR OFFER MAKES IT PATENTLY CLEAR THAT THE OFFEROR DID IN
FACT INTEND TO SO CONFORM. THE CRUX OF THE MATTER IS THE INTENT OF THE
OFFEROR AND ANYTHING SHORT OF A CLEAR INTENTION TO CONFORM ON THE FACE
OF THE BID REQUIRES REJECTION. ANY CLARIFICATION OR EXPLANATION OF THE
BIDDER'S INTENTION BY EXTRANEOUS INFORMATION AFTER BID OPENING WOULD
VIOLATE THE RULE THAT RESPONSIVENESS MUST BE ASCERTAINED FROM THE BID
ITSELF. SEE 38 COMP. GEN. 819 (1959); B-166284, APRIL 14, 1969;
B-167584, OCTOBER 3, 1969; CF. B-169057, APRIL 23, 1970."
FROM THE EVIDENCE DISCUSSED ABOVE, WE CONCLUDE THAT THE LITERATURE
FURNISHED WITH YOUR BID DESCRIBING ITEMS NOT CONFORMING TO THE
SPECIFICATIONS, WITHOUT ANY INDICATION THAT YOU DID NOT INTEND THE
LITERATURE TO QUALIFY THE BID, CAST SUFFICIENT DOUBT ON YOUR INTENTION
IN ACCORDANCE WITH THE RULE SET OUT ABOVE TO JUSTIFY THE CONTRACTING
OFFICER'S ACTION. B-167584, OCTOBER 3, 1969.
ACCORDINGLY, YOUR PROTEST MUST BE DENIED.
B-171917, MAY 4, 1971
BID PROTEST - LITIGATION
ADVISING THAT WITH RESPECT TO THE PROTEST OF MARTIN BAKERY, INC.,
AGAINST THE AWARD OF A CONTRACT TO STERLING BAKERY, INC., UNDER A
SOLICITATION ISSUED BY THE AIR FORCE, SINCE MARTIN HAS FILED AN ACTION
IN THE U.S. DISTRICT COURT, THE COMP. GEN. CONSISTENT WITH POLICY WILL
NOT NOW CONSIDER THE PROTEST.
TO MAGUIRE & TUCKER:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 5, 1971, AND YOUR BRIEF OF
THE SAME DATE, PROTESTING ON BEHALF OF MARTIN BAKERY, INC., THE AWARD OF
A CONTRACT TO STERLING BAKERY, INC., UNDER SOLICITATION NO.
F41615-71-B-0558, ISSUED BY THE DEPARTMENT OF THE AIR FORCE, BASE
PROCUREMENT DIVISION (MS-BP), LACKLAND AIR FORCE BASE, TEXAS.
SUBSEQUENT TO THE FILING OF THE PROTEST WITH OUR OFFICE, MARTIN
BAKERY, INC., FILED AN ACTION IN THE UNITED STATES DISTRICT COURT FOR
THE DISTRICT OF COLUMBIA, CIVIL ACTION NO. 598-71, ON MARCH 23, 1971,
REQUESTING, INTER ALIA, AN INJUNCTION TO COMPEL THE SECRETARY OF THE AIR
FORCE TO CANCEL OR STAY THE PERFORMANCE OF THE CONTRACT AWARDED TO
STERLING BAKERY, INC., AND TO ADJUDGE MARTIN BAKERY, INC., ENTITLED TO
THE CONTRACT. ON MARCH 31, 1971, THE DISTRICT COURT HAVING CONSIDERED
THE CASE ON THE MERITS ENTERED AN ORDER DENYING THE INJUNCTION AND
DISMISSING THE ACTION.
SINCE THE DISTRICT COURT CONSIDERED THE MATERIAL ISSUES OF YOUR
PROTEST ON THE MERITS, WE ARE CLOSING OUR FILE ON THE PROTEST WITHOUT
FURTHER ACTION. THIS IS CONSISTENT WITH THE POLICY OF OUR OFFICE NOT TO
RENDER A DECISION ON A PROTEST WHERE THE MATERIAL ISSUES ARE ALSO
INVOLVED IN LITIGATION IN A COURT OF COMPETENT JURISDICTION. B-171122,
FEBRUARY 9, 1971; B-171050, MARCH 11, 1971; B-171259, APRIL 8, 1971;
AND B-170268, APRIL 14, 1971.
B-172159, MAY 4, 1971
BID PROTEST - AWARDS - PATENT INFRINGEMENT
DENYING PROTEST OF JERVIS B. WEBB COMPANY AGAINST THE AWARD OF A
CONTRACT TO RAPISTAN INCORPORATED, UNDER AN IFB ISSUED BY NEW CUMBERLAND
ARMY DEPOT FOR AN AUTOMATED MATERIAL HANDLING SYSTEM.
WITH RESPECT TO PROTESTANT'S CLAIM THAT A PATENT INFRINGEMENT WILL
OCCUR IF RAPISTAN PRODUCES THE HANDLING SYSTEM, THE COMP. GEN. HAS
CONCLUDED THAT GOVERNMENT CONTRACTS SHOULD NOT BE RESTRICTED TO PATENT
HOLDERS AND THEIR LICENSEES, BUT RATHER ALL POTENTIAL SOURCES SHOULD BE
PERMITTED TO COMPETE FOR GOVERNMENT CONTRACTS REGARDLESS OF POSSIBLE
PATENT INFRINGEMENT.
TO JERVIS B. WEBB COMPANY:
WE REFER TO YOUR LETTER OF APRIL 23, 1971, AND COPIES OF YOUR LETTERS
OF MARCH 18, 1971, AND EARLIER, TO THE CONTRACTING OFFICER, PROCUREMENT
DIVISION, NEW CUMBERLAND ARMY DEPOT, PROTESTING AGAINST THE PROPOSED
AWARD OF A CONTRACT TO RAPISTAN INCORPORATED FOR THE MANUFACTURE AND
OPERATIONAL INSTALLATION OF AN AUTOMATED MATERIAL HANDLING SYSTEM UNDER
INVITATION FOR BIDS (IFB) NO. DAAG36-71-B-0037, THE SECOND STEP OF A
TWO-STEP FORMAL ADVERTISING PROCUREMENT.
FOR THE REASONS STATED BELOW, THE PROTEST IS DENIED.
THE STEP-ONE LETTER REQUEST FOR TECHNICAL PROPOSALS WAS ISSUED
OCTOBER 6, 1970. AFTER RAPISTAN SUBMITTED A LETTER CLARIFYING THE
FIRM'S PROPOSAL ON FEBRUARY 8, 1971, THE PROPOSAL WAS DETERMINED TO BE
ACCEPTABLE. SHORTLY THEREAFTER THE STEP-TWO IFB, WHICH HAD BEEN ISSUED
ON JANUARY 29, 1971, TO THE ACCEPTABLE FIRST-STEP OFFERORS, WAS SUPPLIED
TO RAPISTAN. THE IFB CONTAINED THE USUAL AUTHORIZATION AND CONSENT AND
PATENT INDEMNITY CLAUSES.
PRIOR TO BID OPENING, BY LETTER OF FEBRUARY 25, 1971, YOUR COMPANY
ADVISED THE CONTRACTING OFFICER THAT:
"WITH REGARD TO RAPISTAN, INC., WE DEEM IT IS ADVISABLE TO NOTIFY YOU
THAT THE ENCLOSED TRACK POWER AND FREE CONVEYOR SYSTEM OF OUR TECHNICAL
PROPOSAL INCORPORATES FEATURES COVERED BY OUR U.S. PATENTS NOS.
3,523,504 AND 3,559,585. THESE FEATURES HAVE BEEN INCORPORATED IN A
SIMILAR CONVEYOR SYSTEM RECENTLY OFFERED AND ADVERTISED BY RAPISTAN,
INC. AND WE HAVE NOTIFIED THEM OF OUR PATENT RIGHTS." NOTWITHSTANDING
THE LETTER, BIDS WERE OPENED ON MARCH 9, 1971, AND WERE AS FOLLOWS:
RAPISTAN INCORPORATED $ 991,987
JERVIS B. WEBB COMPANY 1,297,731
APPROVED ALTERNATE 1,298,630
COLUMBUS MCKINNON CORP. 1,383,848
APPROVED ALTERNATE 1,379,522
MID-WEST CONVEYOR CO., INC. 1,500,000
EATON, YALE & TOWNE, INC. 2,237,985
WITH RESPECT TO THE CLAIM THAT PATENT INFRINGEMENT WILL OCCUR IF
RAPISTAN PRODUCES THE HANDLING SYSTEM, ATTENTION IS INVITED TO 46 COMP.
GEN. 205, 206 (1966), WHEREIN IT WAS STATED:
"CONSIDERING THE ACT (28 U.S.C. 1498) AND ITS PURPOSES, THIS OFFICE
HAS CONCLUDED THAT GOVERNMENT CONTRACTS SHOULD NOT BE RESTRICTED TO
PATENT HOLDERS AND THEIR LICENSEES WHERE PATENTS ARE HELD, BUT RATHER
ALL POTENTIAL SOURCES SHOULD BE PERMITTED TO COMPETE FOR GOVERNMENT
CONTRACTS REGARDLESS OF POSSIBLE PATENT INFRINGEMENT. 38 COMP. GEN.
276; 39 ID. 760. SPECIFICALLY, WE HELD IN 38 COMP. GEN. 276 THAT A
PROCURING AGENCY MAY NOT REFUSE TO ADVERTISE FOR AN ITEM BECAUSE OF A
PATENT NOR REFUSE TO MAKE AWARD TO THE LOW BIDDER BECAUSE HE WAS NOT
LICENSED BY THE PATENT HOLDER TO MANUFACTURE THE PATENTED ARTICLE. THE
PROCURING AGENCY, OF COURSE, IS FREE TO REQUIRE PATENT INDEMNITY
AGREEMENTS FROM ITS SUPPLIERS, PERHAPS SHOULD REQUIRE SUCH AGREEMENTS IN
SOME CASES. EVEN THOUGH PATENT INDEMNITY IS NOT PROVIDED FOR IN THE
INVITATION, IT HAS BEEN OUR VIEW THAT A LOW BID MAY NOT BE REJECTED ON
THE BASIS THAT THE GOVERNMENT MIGHT INCUR LIABILITY FOR PATENT
INFRINGEMENT. 45 COMP. GEN. 13." FURTHERMORE, IN 48 COMP. GEN. 403, 407
(1968), OUR OFFICE SAID:
" *** LIKEWISE, IF THE SPANISH WRENCHES INFRINGE RIDGE'S PATENT, AS
YOU CONTEND, IT DOES NOT AFFECT R & O'S ENTITLEMENT TO THE AWARD SINCE
IT IS WELL ESTABLISHED THAT AWARD IS REQUIRED TO BE MADE TO THE LOWEST
BIDDER WITHOUT REGARD TO POSSIBLE PATENT INFRINGEMENT."
YOU CONTEND FURTHER THAT RAPISTAN MAY "HAVE NOT QUOTED ON THE SAME
MATERIAL IN STEP-TWO THAT WAS APPROVED UNDER STEP-ONE AND THEY ARE,
THEREFORE, NON-RESPONSIVE." PART II, SECTION "E," OF THE IFB ISSUED TO
RAPISTAN AND UPON WHICH RAPISTAN BID ON AN UNQUALIFIED BASIS DISPELS
YOUR CONTENTION. SECTION "E" STATES:
"SERVICES: MANUFACTURE AND OPERATIONAL INSTALLATION OF AN AUTOMATED
MATERIAL HANDLING SYSTEM IN BLDG. 84, NEW CUMBERLAND ARMY DEPOT, NEW
CUMBERLAND, PA. IN ACCORDANCE WITH PURCHASE DESCRIPTION NO. D/DT 71-1
DATED 24 AUGUST 1970 WITH ADDENDUM NOS. 1,2,3,4 AND 5 AND RAPISTAN
INCORPORATED TECHNICAL PROPOSAL NO. RSQ-703-7566 AND LETTER OF
CLARIFICATION DATED 8 FEBRUARY 1971 WITH INCLOSURES INCORPORATED HEREIN
BY REFERENCE. NOTHING CONTAINED IN SAID TECHNICAL PROPOSAL SHALL
CONSTITUTE A WAIVER OF ANY OF THE PROVISIONS OF SAID PURCHASE
DESCRIPTION AND ADDENDUMS 1 THRU 5."
IN RESPONSE TO THE OTHER BASES OF THE PROTEST, WE CONCUR WITH THE
CONCLUSIONS OF THE CONTRACTING OFFICER THAT SINCE RAPISTAN FURNISHED THE
REQUIRED CONTINGENT FEE FORM SUBSEQUENT TO BID OPENING, VERIFIED ITS BID
PRICE, DID NOT DEVIATE FROM THE SPECIFICATIONS, AND WAS DETERMINED TO BE
A RESPONSIBLE CONTRACTOR, THERE ARE NO PROPER GROUNDS FOR OBJECTING TO
THE PROPOSED AWARD TO RAPISTAN. SEE B-168881, MARCH 31, 1970;
PARAGRAPH 2-406.1 OF THE ARMED SERVICES PROCUREMENT REGULATION; 17
COMP. GEN. 554, 557 (1938); AND 37 ID. 430, 435 (1957), RESPECTIVELY.
WITH RESPECT TO YOUR CONTENTION THAT RAPISTAN WAS ALLOWED TO CHANGE ITS
TECHNICAL PROPOSAL AFTER AN INITIAL DETERMINATION THAT IT WAS
UNACCEPTABLE IN STEP ONE, OUR OFFICE HAS BEEN ADVISED THAT RAPISTAN DID
NOT MAKE ANY CHANGES BUT MERELY SUBMITTED CLARIFICATIONS OF A MINOR
SUPPLEMENTAL NATURE. SEE 43 COMP. GEN. 255 (1963).
B-118653, MAY 3, 1971
FEDERAL AID HIGHWAY FUNDS - RIGHT-OF-WAY-COSTS
ADVISING THAT IN VIEW OF THE UNUSUAL CIRCUMSTANCES OF THE CASE,
FEDERAL-AID HIGHWAY FUNDS MAY PARTICIPATE IN THE COST OF ACQUISITION OF
PROPERTIES ORIGINALLY ACQUIRED FOR THE RIGHT-OF-WAY FOR AN INTERSTATE
HIGHWAY SYSTEM HIGHWAY SEGMENT INCLUDING LOSSES WHICH MAY BE INCURRED IN
THE DISPOSITION OF SUCH PROPERTIES AFTER A DETERMINATION TO CHANGE THE
LOCATION OF THE SEGMENT IN QUESTION.
SINCE THE DECISION TO SEEK ALTERNATIVE RIGHTS-OF-WAY FOR I-70N IN THE
ROSEMONT COMMUNITY OF BALTIMORE WAS INITIATED AND INSISTED UPON BY THE
FEDERAL HIGHWAY ADMINISTRATION (ALONG WITH THE DIRECT PERSONAL
INVOLVEMENT OF THE FEDERAL HIGHWAY ADMINISTRATOR), FUNDS CAN BE USED AS
MENTIONED ABOVE.
TO MR. SECRETARY:
REFERENCE IS MADE TO YOUR LETTERS OF JULY 31, 1970, AND MARCH 16,
1971, WITH ENCLOSURES, IN WHICH YOU REQUEST OUR DECISION AS TO WHETHER
FEDERAL-AID HIGHWAY FUNDS MAY PARTICIPATE IN THE COST OF ACQUISITION OF
PROPERTIES ORIGINALLY ACQUIRED FOR A RIGHT-OF-WAY FOR AN INTERSTATE
HIGHWAY SYSTEM HIGHWAY SEGMENT, INCLUDING LOSSES WHICH MAY BE INCURRED
IN THE DISPOSITION OF SUCH PROPERTIES, IN VIEW OF A SUBSEQUENT
DETERMINATION FOR A CHANGE OF LOCATION OF THE SEGMENT IN QUESTION.
ON SEPTEMBER 11, 1967, THE FEDERAL HIGHWAY ADMINISTRATION (FHWA)
AUTHORIZED THE MARYLAND STATE ROADS COMMISSION TO PROCEED WITH
ACQUISITION OF RIGHTS-OF-WAY FOR I-70N IN THE ROSEMONT COMMUNITY OF
BALTIMORE CITY UNDER A STAGE 1 PROGRAM. IN ACCORDANCE WITH PROCEDURES
SET FORTH IN FEDERAL HIGHWAY ADMINISTRATION POLICY AND PROCEDURE
MEMORANDUM 21-1 (APRIL 15, 1968), AS AMENDED, THE NOTICE TO THE STATE
APPROVING THE STAGE 1 PROGRAM STATED THAT AUTHORIZATION TO PROCEED
"SHALL NOT CONSTITUTE ANY COMMITMENT OF FEDERAL FUNDS NOR SHALL IT BE
CONSTRUED AS CREATING, IN ANY MANNER, ANY OBLIGATION ON THE PART OF THE
FEDERAL GOVERNMENT TO PROVIDE FEDERAL FUNDS FOR THE UNDERTAKING."
SUBSEQUENTLY, THE CITY OF BALTIMORE, WHICH HAD ALREADY PASSED A
CONDEMNATION ORDINANCE, BEGAN TO ACQUIRE PROPERTIES FOR RIGHT-OF-WAY
PURPOSES. UNDER THE ORIGINAL ROSEMONT ALIGNMENT, A TOTAL OF ABOUT 800
RESIDENTIAL PROPERTIES WOULD BE TAKEN FOR CONSTRUCTION OF THE HIGHWAY.
SUBSEQUENTLY, CONSIDERABLE CONTROVERSY AROSE CONCERNING THE ALIGNMENT
OF THE INTERSTATE SYSTEM HIGHWAY SEGMENTS TO BE BUILT THROUGH THE CITY.
THE CITY THEREUPON EMPLOYED FOUR CONSULTING FIRMS, KNOWN AS THE URBAN
DESIGN CONCEPT ASSOCIATES (ASSOCIATES). BECAUSE OF THE UNIQUENESS OF
THE USE OF THESE FIRMS, THE FEDERAL HIGHWAY ADMINISTRATOR DESIGNATED A
REPRESENTATIVE TO WORK WITH THE ASSOCIATES IN ORDER THAT THE WASHINGTON,
D.C., OFFICE OF THE BUREAU OF PUBLIC ROADS COULD BE FULLY ADVISED OF
THEIR WORK.
ON OCTOBER 18, 1968, THE ASSOCIATES ISSUED A REPORT RECOMMENDING THAT
THE ROSEMONT COMMUNITY BE BYPASSED. ON OR ABOUT NOVEMBER 1, 1968, THE
THEN FEDERAL HIGHWAY ADMINISTRATOR, MEETING WITH STATE AND LOCAL
OFFICIALS, AGREED TO A RESTUDY OF THE ROSEMONT LOCATION BUT CAUTIONED
THAT FEDERAL-AID HIGHWAY FUNDS COULD ONLY PARTICIPATE IN THE PURCHASE OF
THAT PORTION OF THE RIGHT-OF-WAY THAT WOULD ACTUALLY BE UTILIZED FOR THE
HIGHWAY.
ON DECEMBER 24, 1968, THE BALTIMORE CITY AUTHORITIES FINALIZED THEIR
DECISION TO BYPASS THE ROSEMONT AREA AND NOT TO USE THE PROPERTIES
ACQUIRED FOR HIGHWAY PURPOSES. THIS DECISION WAS CONCURRED IN BY THE
MARYLAND STATE ROADS COMMISSION AND APPROVED BY THE FEDERAL HIGHWAY
ADMINISTRATION ON JANUARY 17, 1969.
ON JANUARY 22, 1969, BALTIMORE OFFICIALS WROTE OWNER-OCCUPANTS OF THE
ROSEMONT COMMUNITY OF THE DECISION TO BYPASS THE AREA, STATING THAT:
"THE CITY STILL RECOGNIZES ITS COMMITMENT TO PURCHASE THE HOUSES OF
OWNER-OCCUPANTS LIVING IN THE CONDEMNATION LINE *** ." A TOTAL OF 486
PROPERTIES WERE ACQUIRED BY THE CITY, 249 OF WHICH WERE PURCHASED PRIOR
TO THE DECEMBER 24TH DECISION TO BYPASS THE ROSEMONT AREA.
STATE AND CITY AUTHORITIES HAVE RAISED THE QUESTION AS TO WHETHER
FEDERAL-AID HIGHWAY FUNDS MAY PARTICIPATE IN THE COST OF ACQUISITION OF
THE ROSEMONT AREA PROPERTIES AND WHATEVER LOSS MAY BE INCURRED IN THEIR
DISPOSITION.
YOUR POSITION IS THAT FEDERAL-AID HIGHWAY FUNDS SHOULD PARTICIPATE IN
ACQUISITION COSTS, INCLUDING RELOCATION ASSISTANCE AND ADDITIVE COSTS
RELATING THERETO, TO THE EXTENT SUCH COSTS EXCEED THE PROCEEDS DERIVED
FROM DISPOSITION. HOWEVER, YOU WOULD EXCLUDE THEREFROM REHABILITATION
COSTS NECESSARY TO MAKE THE PROPERTIES SALEABLE; ANY LOSSES
ATTRIBUTABLE TO THE NEGOTIATED SALE OF PROPERTY AT LESS THAN FAIR MARKET
VALUE; AND COSTS AND LOSSES ATTRIBUTABLE TO PROPERTIES ACQUIRED
SUBSEQUENT TO THE DECISION OF DECEMBER 24, 1968, TO BYPASS THE ROSEMONT
AREA.
IN VIEW OF THE NEED FOR PRELIMINARY ENGINEERING SURVEYS AND
RIGHT-OF-WAY ACQUISITION TO MOVE FORWARD FAR IN ADVANCE OF ACTUAL
HIGHWAY CONSTRUCTION, YOU STATE IN YOUR LETTER:
"IT IS BELIEVED THAT IT WOULD BE UNJUST FOR THE FEDERAL HIGHWAY
ADMINISTRATION, HAVING APPROVED THE ROSEMONT LOCATION AND AUTHORIZED THE
STATE TO PROCEED WITH THE RIGHT-OF-WAY ACQUISITION, TO DENY FEDERAL
PARTICIPATION IN THIS CASE. SUCH A DENIAL WOULD BE INCONSISTENT WITH
THE FEDERAL HIGHWAY ADMINISTRATION'S INDUCEMENT TO OR INFLUENCE UPON THE
STATE TO ACT, TO THE PREJUDICE OF THE STATE.
"TO DENY FEDERAL-AID HIGHWAY FUND PARTICIPATION IN THIS CASE WOULD
AMOUNT TO PENALIZING THE STATE FOR GIVING RECOGNITION TO THE SOCIAL AND
ENVIRONMENTAL GOAL THAT THE BUILDING OF HIGHWAYS WILL CAUSE THE LEAST
DISRUPTION OF HUMAN AND NATURAL RESOURCES, A GOAL EMBODIED IN FEDERAL
LAW AND CURRENT NATIONAL POLICY."
CITY AND STATE OFFICIALS SIMILARLY ARGUE THAT IT WOULD BE INEQUITABLE
TO PERMIT THE FEDERAL HIGHWAY ADMINISTRATION, HAVING APPROVED THE
ROSEMONT LOCATION AND HAVING AUTHORIZED THE STATE TO PROCEED WITH
RIGHT-OF-WAY ACQUISITION, TO INVOKE THE SAVINGS CLAUSE CONTAINED IN THE
STAGE 1 APPROVAL TO DENY THE PARTICIPATION OF FEDERAL-AID HIGHWAY FUNDS
IN THIS MATTER, SINCE -
" *** THE CITY OF BALTIMORE, STATE ROADS COMMISSION, THE POLICY
ADVISORY BOARD, AND THE BUREAU OF PUBLIC ROADS AND FEDERAL HIGHWAY
ADMINISTRATION ACTED IN CONCERT IN THE DECISION TO BYPASS THE ROSEMONT
COMMUNITY, AND THE OBVIOUS MUTUAL OBJECTIVE WAS TO MINIMIZE THE IMPACT
OF SAID DECISION ON THE RESIDENTS THEREIN. *** "
IT IS FURTHER SUBMITTED THAT THE DECISION TO BYPASS THE ROSEMONT AREA
IS CONSISTENT WITH AND, TO SOME EXTENT RESPONSIVE TO, THE EXPRESSED
INTENT OF CONGRESS, EMBODIED IN SECTION 24 OF THE FEDERAL-AID HIGHWAY
ACT OF 1968, ENACTED AUGUST 23, 1968, 23 U.S.C. 128, THAT IN SELECTING
ROUTES FOR HIGHWAYS, THE STATE CONSIDER "THE ECONOMIC AND SOCIAL EFFECTS
OF SUCH A LOCATION, ITS IMPACT ON THE ENVIRONMENT, AND ITS CONSISTENCY
WITH THE GOALS AND OBJECTIVES OF SUCH URBAN PLANNING AS HAS BEEN
PROMULGATED BY THE COMMUNITY."
UNDER THE PERTINENT STATUTES IT IS THE ULTIMATE RESPONSIBILITY OF THE
STATE TO SELECT THE INTERSTATE SYSTEM HIGHWAY ROUTE BEST SUITED TO ITS
NEEDS, AND THE STATUTORY ROLE OF THE FEDERAL GOVERNMENT IS TO APPROVE OR
DISAPPROVE THE STATE'S PROPOSALS. SEE CHAPTER 1 OF TITLE 23, UNITED
STATES CODE. THUS, AS A GENERAL RULE, WHEN A STATE PROPOSES A ROUTE
ALTERNATIVE TO ONE ALREADY SELECTED BY THE STATE AND APPROVED BY FHWA,
THE LEGAL RESPONSIBILITY FOR ANY CHANGE IN PLANS RESTS WITH THE STATE
AND IT MUST ACCEPT THE FINANCIAL BURDEN OF ITS DECISION, EVEN THOUGH
FHWA OFFICIALS MAY WORK WITH STATE OFFICIALS IN SELECTING AN ALTERNATIVE
ROUTE, FEDERAL-AID HIGHWAY FUNDS PARTICIPATE IN THE COSTS OF THE STUDY
OF ALTERNATIVES AND FHWA FINALLY APPROVES AN ALTERNATIVE ROUTE.
HOWEVER, YOU ADVISE IN YOUR LETTER OF MARCH 16 THAT "IT IS CLEAR THAT
THE DEPARTMENT'S INVOLVEMENT IN THIS CASE WAS SUBSTANTIAL AND WENT
BEYOND WHAT MIGHT BE EXPECTED IN THE TYPICAL CASE." YOU STATE THAT THERE
WAS A GREAT DEAL OF CONSULTATION BETWEEN OFFICIALS OF YOUR DEPARTMENT
AND STATE AND LOCAL OFFICIALS REGARDING THE SOLUTION TO WHAT HAD BECOME
A VERY EMOTIONAL ENVIRONMENTAL AND SOCIAL ISSUE INVOLVING THE HIGHWAY'S
LOCATION. FURTHER, YOU STATE THAT THERE WAS EXTENSIVE FEDERAL
PARTICIPATION THROUGHOUT THE RESTUDY WHICH EVENTUALLY LED TO ABANDONMENT
OF THE ROSEMONT CORRIDOR. BUT, ACCORDING TO YOUR MARCH 16 LETTER THE
FACTOR WHICH CONTRIBUTED MOST TO THE UNIQUENESS OF THIS CASE WAS THE
PERSONAL INVOLVEMENT OF THE FORMER FEDERAL HIGHWAY ADMINISTRATOR IN
INITIATING THE RESTUDY AND INSISTING ON AN ALTERNATIVE. YOU STATE IN
THIS REGARD THAT:
"THE UNIQUENESS OF THE ROSEMONT CASE RELATES TO THE INITIATION OF A
SUGGESTION AND INSISTENCE BY THE FEDERAL HIGHWAY ADMINISTRATION THAT
ALTERNATIVES TO THE ROSEMONT LINE FOR I-70 N SHOULD BE EXPLORED. LOWELL
K. BRIDWELL, THE THEN FEDERAL HIGHWAY ADMINISTRATOR, INDICATED AT THE
ABOVE CITED MEETING BETWEEN CITY, STATE, AND FEDERAL OFFICIALS THAT HE
WOULD INSIST ON A REEVALUATION AND ALTERNATIVE TO THE ROSEMONT LINE.
THIS UNUSUAL INITIATIVE ACTIVITY ON THE PART OF THE FEDERAL HIGHWAY
ADMINISTRATION RESULTED FROM ITS CONCERN WITH THE OPPOSITION OF THE
ROSEMONT COMMUNITY. THE FEDERAL HIGHWAY ADMINISTRATION RARELY INITIATES
AND ACTIVELY PURSUES A LINE CHANGE AFTER PROPERTY ACQUISITION FOR THE
HIGHWAY HAS COMMENCED. ADDING TO THE UNIQUENESS OF THE ROSEMONT CASE
WAS THE DIRECT PERSONAL INVOLVEMENT OF THE FEDERAL HIGHWAY ADMINISTRATOR
IN THE REQUEST TO SEEK AN ALTERNATIVE ALINEMENT TO THE ROSEMONT LINE.
"IT IS OUR VIEW THAT OTHER SITUATIONS, AS DESCRIBED ABOVE, WHERE THE
FEDERAL HIGHWAY ADMINISTRATION, WITH PERSONAL INVOLVEMENT OF THE FEDERAL
HIGHWAY ADMINISTRATOR, INITIATES A REQUEST FOR REEXAMINATION OF AN
ALINEMENT AFTER ACTUAL ACQUISITION OF PROPERTIES FOR THE HIGHWAY HAS
COMMENCED ARE UNLIKELY TO OCCUR AGAIN ANYTIME SOON."
IN SUMMARY, YOU INDICATE THAT A VARIETY OF FACTORS, INCLUDING, IN
PARTICULAR, THE INTENSITY OF THE DEPARTMENTAL EFFORTS TO INITIATE A
RESTUDY OF THE ROSEMONT CORRIDOR AND TO HAVE AN ALTERNATIVE ROUTE
SELECTED AND THE UNIQUE AND UNUSUAL NATURE OF THE PERSONAL INVOLVEMENT
OF THE FORMER FEDERAL HIGHWAY ADMINISTRATOR, COMBINE TO MAKE THIS AN
UNUSUAL CASE IN WHICH BALTIMORE'S CLAIM SHOULD BE PAID.
IN LIGHT OF THE FOREGOING FACTS AND CIRCUMSTANCES, AND PARTICULARLY
SINCE A SIMILAR SITUATION IS NOT LIKELY TO OCCUR AGAIN, AS WELL AS YOUR
AFFIRMATIVE RECOMMENDATION THAT FEDERAL-AID HIGHWAY FUNDS SHOULD
PARTICIPATE IN THE RIGHT-OF-WAY COSTS IN THE ROSEMONT CORRIDOR, WE WOULD
NOT OBJECT TO FEDERAL-AID HIGHWAY FUNDS PARTICIPATING IN THE ACQUISITION
COST OF THE ROSEMONT AREA PROPERTIES AND WHATEVER LOSS MAY BE INCURRED
IN THEIR DISPOSITION TO THE EXTENT RECOMMENDED IN YOUR LETTER OF JULY
31, 1970.
B-170012, MAY 3, 1971
RELIEF OF CASHIER - PROOF OF NEGLIGENCE
REAFFIRMING PRIOR DECISION HOLDING MRS. BEATRICE B. PENDERGRASS,
CASHIER AT THE NATIONAL COMMUNICABLE DISEASE CENTER, LAWRENCEVILLE, GA.,
LIABLE FOR THE LOSS OF $250 RECEIVED BY HER FOR SAFEKEEPING IN THE
COURSE OF HER DUTIES.
THAT MRS. PENDERGRASS WAS NOT DIRECTED TO ACCEPT CUSTODY OF THE $250
FROM ANOTHER EMPLOYEE ALTHOUGH THE LATTER HAD BEEN DIRECTED TO TURN THAT
AMOUNT IN, IS OF NO WEIGHT AGAINST THE USUAL RULE THAT IF THE REBUTTABLE
PRESUMPTION OF NEGLIGENCE IS NOT OVERCOME, THE ACCOUNTABLE OFFICER WILL
BE HELD LIABLE FOR LOSS OF FUNDS.
TO MR. SECRETARY:
BY LETTER TO THE GENERAL COUNSEL OF OUR OFFICE DATED JANUARY 26,
1971, MR. JAMES B. CARDWELL, ASSISTANT SECRETARY, COMPTROLLER,
DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE (HEW), RECOMMENDED ON YOUR
BEHALF THAT MRS. BEATRICE B. PENDERGRASS, CLASS "B" CASHIER, NATIONAL
COMMUNICABLE DIESEASE CENTER (NCDC), LAWRENCEVILLE, GEORGIA, HEALTH
SERVICES AND MENTAL HEALTH ADMINISTRATION, HEW, BE GRANTED RELIEF FOR
THE LOSS OF $250, FOR WHICH OUR DECISION OF AUGUST 11, 1970, B-170012,
HELD HER LIABLE. MRS. PENDERGRASS HAD REQUESTED THIS OFFICE FOR A
RECONSIDERATION OF THAT DECISION BY LETTER DATED SEPTEMBER 30, 1970,
FORWARDED TO US ON OCTOBER 14, 1970.
THE CIRCUMSTANCES SURROUNDING THE SHORTAGE, AS ORIGINALLY REPORTED TO
US, ARE SET OUT IN DETAIL IN OUR DECISION OF AUGUST 11, 1970, SUPRA, AND
NEED NOT BE REPEATED HERE.
IN SUMMARY, THE RECORD ON WHICH WE RELIED IN REACHING OUR DECISION
WAS AS FOLLOWS:
THAT MRS. PENDERGRASS, IN THE COURSE OF HER DUTIES, RECEIVED FOR
SAFEKEEPING $250 IN FEDERAL FUNDS WHICH WERE LOST WHILE IN HER CUSTODY
WITHOUT ANY EXPLANATION AS TO HOW THE LOSS OCCURRED. NO AFFIRMATIVE
EVIDENCE THAT THE LOSS OCCURRED WITHOUT HER NEGLIGENCE WAS PRESENTED.
OUR DECISION OF AUGUST 11, 1970, HELD MRS. PENDERGRASS LIABLE FOR THE
LOSS IN ACCORD WITH OUR LONG-HELD POSITION THAT WHERE AN ACCOUNTABLE
OFFICER SUFFERS AN UNEXPLAINED LOSS OF FEDERAL FUNDS IN THE COURSE OF
EMPLOYMENT, THERE IS A REBUTTABLE PRESUMPTION THAT THE ACCOUNTABLE
OFFICER WAS NEGLIGENT, AND IF THIS PRESUMPTION IS NOT OVERCOME, WE
CANNOT CONCUR WITH THE REQUEST OF THE HEAD OF THE AGENCY, OR HIS
AUTHORIZED DELEGATE, IN RELIEVING FROM LIABILITY UNDER 31 U.S.C. 82A-1,
48 COMP. GEN. 566 (1969).
31 U.S.C. 82A-1 PROVIDES IN PERTINENT PART:
"THE GENERAL ACCOUNTING OFFICE IS AUTHORIZED, AFTER CONSIDERATION OF
THE PERTINENT FINDINGS AND IF IN CONCURRENCE WITH THE DETERMINATIONS AND
RECOMMENDATIONS OF THE HEAD OF THE DEPARTMENT OR INDEPENDENT
ESTABLISHMENT CONCERNED, TO RELIEVE ANY DISBURSING OR OTHER ACCOUNTABLE
OFFICER OR AGENT OR FORMER DISBURSING OR ACCOUNTABLE OFFICER OR AGENCY
OF ANY SUCH DEPARTMENT OR INDEPENDENT ESTABLISHMENT OF THE GOVERNMENT
CHARGED WITH RESPONSIBILITY ON ACCOUNT OF PHYSICAL LOSS OR DEFICIENCY OF
GOVERNMENT FUNDS, VOUCHERS, RECORDS, CHECKS, SECURITIES, OR PAPERS IN
HIS CHARGE, IF THE HEAD OF THE DEPARTMENT OR INDEPENDENT ESTABLISHMENT
DETERMINES (1) THAT SUCH LOSS OR DEFICIENCY OCCURRED WHILE SUCH OFFICER
OR AGENT WAS ACTING IN THE DISCHARGE OF HIS OFFICIAL DUTIES, OR THAT
SUCH LOSS OR DEFICIENCY OCCURRED BY REASON OF THE ACT OR OMISSION OF A
SUBORDINATE OF SUCH OFFICER OR AGENT; AND (2) THAT SUCH LOSS OR
DEFICIENCY OCCURRED WITHOUT FAULT OR NEGLIGENCE ON THE PART OF SUCH
OFFICER OR AGENT. *** "
THE INFORMATION NOW PRESENTED BY THE LETTER OF JANUARY 26, 1971, IS
TO THE EFFECT THAT MRS. PENDERGRASS WAS NOT DIRECTED TO ACCEPT CUSTODY
OF THE $250 FROM MR. TREVINO ALTHOUGH HE HAD BEEN DIRECTED BY
ADMINISTRATIVE OFFICIALS OF THE PROGRAM BY WHICH HE WAS EMPLOYED TO TURN
IN HIS PASSPORT, THE $250 AND TRAVEL ADVANCE CHECK FOR SAFEKEEPING
CUSTODY TO HER.
HOWEVER, THE FACT THAT MRS. PENDERGRASS DID NOT HAVE SPECIFIC
DIRECTION FROM SUPERVISORY PERSONNEL TO ACCEPT THE FUNDS IN QUESTION,
LIKE THE FACT THAT HER POSITION DESCRIPTION DID NOT CONTAIN SPECIFICALLY
ENUMERATED DUTIES AS A COLLECTION OFFICER, DOES NOT CHANGE THE FACT THAT
THESE WERE FEDERAL FUNDS FOR WHICH SHE WAS ACCOUNTABLE. HER POSITION
DESCRIPTION INCLUDED THE DUTIES OF A CLASS "B" CASHIER, THE DUTIES AND
RESPONSIBILITIES FOR WHICH ARE SET FORTH IN THE "MANUAL OF PROCEDURES
AND INSTRUCTIONS FOR CASHIERS" ISSUED BY THE DEPARTMENT OF THE TREASURY.
THE CONTENTION OF MRS. PENDERGRASS THAT THESE WERE PERSONAL FUNDS OF
MR. TREVINO FOR WHICH SHE IS NOT ACCOUNTABLE, RATHER THAN PUBLIC FUNDS,
IS WITHOUT MERIT. EVEN IF IT BE CONCEDED THAT TRAVEL ADVANCE FUNDS LOSE
THEIR IDENTITY AS PUBLIC FUNDS WHEN ADVANCED TO A FEDERAL EMPLOYEE, SUCH
FUNDS WHEN RETURNED TO THE FEDERAL GOVERNMENT BY SUCH EMPLOYEE PURSUANT
TO OFFICIAL REQUEST OR DIRECTION WOULD AGAIN BECOME PUBLIC FUNDS.
AN ACCOUNTABLE OFFICER IS A CUSTODIAN OF GOVERNMENT FUNDS. SEE
B-155149, OCTOBER 21, 1964; ALSO B-151156, DECEMBER 30, 1963. WE HAVE
STATED BEFORE "THE TERM 'ACCOUNTABLE OFFICER' REFERS TO ANY GOVERNMENT
PERSONNEL WHO ARE PECUNIARILY RESPONSIBLE TO THE GOVERNMENT FOR THEIR
OFFICIAL ACTIVITIES. *** " B-144467, DECEMBER 19, 1960. THE
LEGISLATIVE HISTORY OF 31 U.S.C. 82A-1 STATES THAT AGENTS OF THE
GOVERNMENT WHO ARE "FULLY RESPONSIBLE FOR FUNDS *** ENTRUSTED TO THEIR
CHARGE", S. REPT. NO. 379, 80TH CONG., 1ST SESS., P. 2, ARE ENTITLED TO
THE RELIEF PROVISIONS OF THE STATUTE. THE TERM "ENTRUSTED" INDICATES
THE CUSTODIAL NATURE OF AN ACCOUNTABLE OFFICER'S RELATIONSHIP TO THE
GOVERNMENT.
THE OTHER TWO REASONS GIVEN IN YOUR LETTER OF JANUARY 26, 1971, FOR
THE RELIEF OF MRS. PENDERGRASS - THAT THERE WAS NO EVIDENCE OF FAULT OR
NEGLIGENCE ON HER PART AND THAT SHE HAD NO CONTROL OVER THE SECURITY
PROVIDED AT THE FACILITY WHERE THE SAFE WAS LOCATED - WERE CONSIDERED
AND DISCUSSED IN OUR PRIOR DECISION ON THIS CASE.
B-170633(1), MAY 3, 1971
BID PROTEST - NEGOTIATED AWARD - PRICE V QUALITY
DENYING PROTEST OF SYNERGY, INC., AGAINST THE AWARD TO TECHNICAL
SCIENTIFIC SERVICE OF A NEGOTIATED CONTRACT UNDER AN RFP ISSUED BY
WRIGHT-PATTERSON AFB, OHIO, FOR LABOR AND MATERIALS REQUIRED TO PERFORM
PREVENTIVE MAINTENANCE ON CERTAIN ELECTRONIC EQUIPMENT.
ALTHOUGH PROTESTANT'S PROPOSAL WAS TECHNICALLY ACCEPTABLE AND RANKED
ONLY EIGHT POINTS BEHIND THE SUCCESSFUL PROPOSER'S, CONTRACTING
OFFICER'S DETERMINATION THAT THE TECHNICAL DIFFERENCES WERE SIGNIFICANT,
JUSTIFIED ACCEPTANCE OF THE HIGHER PRICED OFFER AND DISTINGUISHED THIS
CASE FROM B-169148 WHERE AWARD WAS REQUIRED TO BE GIVEN TO LOWER PRICED
OFFEROR WHOSE TECHNICAL RATING WAS SIX POINTS BELOW THE ORIGINAL AWARDEE
BUT WHOSE TECHNICAL CAPACITY WAS CONSIDERED ESSENTIALLY EQUAL TO THAT OF
THE HIGHER RATED OFFEROR.
TO SYNERGY, INCORPORATED:
REFERENCE IS MADE TO YOUR LETTERS OF AUGUST 17, 1970, AND JANUARY 5,
1971, PROTESTING AGAINST THE AWARD OF A CONTRACT TO ANOTHER CONCERN
UNDER REQUEST FOR PROPOSALS NO. F 33601-71-R-0002, ISSUED JUNE 22,
1970, BY THE PROCUREMENT DIVISION, WRIGHT-PATTERSON AIR FORCE BASE,
OHIO.
THE CONTRACTOR WAS TO PROVIDE ALL MANAGEMENT, LABOR, MATERIALS, PARTS
AND EQUIPMENT AS REQUIRED TO PERFORM PREVENTIVE MAINTENANCE ON CERTAIN
ELECTRONIC EQUIPMENT AND R&D FACILITIES UNDER THE JURISDICTION OF
VARIOUS AIR FORCE LABORATORIES. THE CONTRACT WAS TO BE AWARDED FOR A
ONE-YEAR PERIOD FROM AUGUST 1, 1970, THROUGH JULY 31, 1971, WITH TWO
OPTION PERIODS OF ONE YEAR EACH.
SUBPARAGRAPH A ON PAGE 22 OF THE RFP PROVIDED THAT TECHNICAL
PROPOSALS WOULD BE EVALUATED FOR TECHNICAL ACCEPTANCE UNDER THE CRITERIA
LISTED UNDER TECHNICAL PROPOSAL, SECTION C. SUBPARAGRAPH B PROVIDED THAT
COST PROPOSALS WOULD BE EVALUATED EXCLUSIVE OF OPTIONS. SEPARATE
TECHNICAL AND COST PROPOSALS WERE CONTEMPLATED. SUBPARAGRAPH C ON PAGE
22 OF THE RFP STATED THAT AWARD WOULD BE PREDICATED ON NEGOTIATIONS
CONDUCTED AFTER COMPLETION OF TECHNICAL EVALUATIONS, THAT NEGOTIATIONS
WOULD BE CONDUCTED ONLY WITH THOSE OFFERORS CONSIDERED TO BE TECHNICALLY
QUALIFIED AND WITHIN A COMPETITIVE PRICE RANGE AND THAT THE GOVERNMENT
RESERVED THE RIGHT TO AWARD A CONTRACT WITHOUT NEGOTIATION AND WITHOUT
DISCUSSION OF OFFERS RECEIVED.
SECTION C, TECHNICAL PROPOSAL, ON PAGE 20 OF THE RFP, ADVISED
OFFERORS THAT THE TECHNICAL PROPOSAL SHOULD NOT MAKE REFERENCE TO COST
OR PRICE DATA AND THAT THE EVALUATION OF THAT PORTION WOULD BE STRICTLY
ON THE BASIS OF TECHNICAL MERIT. OFFERORS WERE ALSO ADVISED OF CERTAIN
MINIMUM INFORMATION TO BE INCLUDED WITH THE TECHNICAL PROPOSAL. THIS
MINIMUM INFORMATION INCLUDED A STATEMENT REGARDING THE PERSONNEL TO BE
ASSIGNED TO EACH POSITION INCLUDING RESUMES. OFFERORS WERE ADVISED THAT
SINCE ALL PERSONNEL HAD TO BE ON-SITE AT THE TIME OF CONTRACT AWARD,
THEY HAD TO BE CURRENTLY EMPLOYED BY THE OFFEROR, OR THE OFFEROR HAD TO
HAVE A FIRM AND IRREVOCABLE WRITTEN AGREEMENT, DISCLOSED IN THE
TECHNICAL PROPOSAL, TO OBTAIN QUALIFIED PERSONNEL NOT CURRENTLY IN HIS
EMPLOY. ALSO REQUIRED WERE EVIDENCE OF THE OFFEROR'S BACKGROUND AND
EXPERIENCE IN ALL FIELDS RELATED TO WORK UNDER THE CONTRACT, A
DESCRIPTION OF THE ORGANIZATIONAL STRUCTURE AND A DISCUSSION OF THE
OFFEROR'S APPROACH TO ADMINISTERING THE PROGRAM. PAGES 12 THROUGH 19
GAVE DETAILED INFORMATION WITH RESPECT TO THE EXPERIENCE REQUIREMENTS
FOR THE VARIOUS EMPLOYEES AND ALSO DESCRIBED THE ASSIGNMENTS OF SUCH
EMPLOYEES.
SIX PROPOSALS WERE RECEIVED BY THE CLOSING DATE OF JULY 8, 1970, AND
THE TECHNICAL PROPOSALS WERE EVALUATED BY A PANEL OF PERSONNEL DRAWN
MAINLY FROM LABORATORIES WHO WERE FAMILIAR WITH THE REQUIREMENTS OF THE
RFP. THE TECHNICAL SCIENTIFIC SERVICES (TSS) PROPOSAL RECEIVED 88
POINTS AND YOUR PROPOSAL RECEIVED 80 POINTS. ALL OF THE OTHER PROPOSALS
WERE FOUND TO BE TECHNICALLY UNACCEPTABLE AND WERE NOT CONSIDERED
FURTHER.
THE TECHNICAL EVALUATION REPORT ON THE RFP DATED JULY 24, 1970,
RECOMMENDED AN AWARD TO TSS BASED ON THE FOLLOWING CONSIDERATIONS:
"(A) TSS (88 POINTS) THIS WAS THE ONLY ACCEPTABLE PROPOSAL WHICH
PRESENTED A COMBINATION OF CAREFUL COMPLIANCE WITH ALL REQUIREMENTS,
GOOD CONTRACT HISTORY, GOOD COMPANY EXPERIENCE WITH EXCELLENT PERSONNEL
AND FACILITIES. THEIR STREAMLINED MANAGEMENT OF THE PROGRAM WITH A
MINIMUM OF 'RED TAPE' ON ORDERING SUPPLIES TOGETHER WITH THE NEARBY
AVAILABILITY OF EXTENSIVE SENIOR ENGINEERING TALENT (IF NECESSARY) AND
SHOP FACILITIES ARE CONSIDERED THE STRONG POINTS OF THIS PROPOSAL.
'SPEED OF RESPONSE' IS VERY IMPORTANT IN HANDLING MAINTENANCE OF
CRITICAL EQUIPMENT; THIS COMPANY IS WELL ORGANIZED FOR THIS TYPE OF
BUSINESS. THE AWARD OF THIS CONTRACT TO THIS COMPANY IS STRONGLY
RECOMMENDED TO BE IN THE BEST INTEREST OF THE GOVERNMENT.
"(B) SYNERGY (80 POINTS) ALTHOUGH OVERALL THIS PROPOSAL RATED
ACCEPTABLE, IT WAS QUITE NOTICEABLY WEAK IN PERSONNEL QUALIFICATIONS.
FEW, IF ANY, DEGREE LEVEL PEOPLE WERE AVAILABLE AND A NUMBER OF PEOPLE
WERE NOT YET EMPLOYED BY THE COMPANY. OTHERWISE, THIS ORGANIZATION IS
CONSIDERED WELL QUALIFIED FOR THIS WORK."
THE PRICE PROPOSALS FROM TSS AND YOUR CONCERN COMPARED AS FOLLOWS:
PERIOD SYNERGY TSS
FIRST YEAR $268,700.80 $285,777.60
SECOND YEAR OPTION $282,428.80 $311,403.20
THIRD YEAR OPTION $294,451.20 $339,233.60
AIR FORCE'S REPORT STATES AS FOLLOWS WITH RESPECT TO THE PRICE
EVALUATION:
"THE ABOVE ARE BASED UPON A TIME AND MATERIAL AND LABOR HOUR TYPE OF
CONTRACT ASSUMING BOTH FIRMS WOULD REQUIRE AN EQUAL AMOUNT OF TIME TO
ACCOMPLISH THE SAME WORK ORDERS. HOWEVER, THE INCUMBENT CONTRACTOR
COULD BE EXPECTED TO COMPLETE MANY OF THE VARIOUS JOBS MORE QUICKLY, AND
THEREFORE AT LESS EXPENSE TO THE GOVERNMENT, THAN A NEW FIRM WITH
PERSONNEL WHO WERE UNFAMILIAR WITH THE SPECIAL EQUIPMENT. FURTHERMORE,
MANY OF THE LABORATORY R&D PROJECTS ARE HIGHLY CRITICAL AND COULD BE
PLACED IN SERIOUS JEOPARDY BY GAPS OR DELAYS IN THE WORK TO BE DONE ON
THE EQUIPMENT INVOLVED."
A CONTRACT WAS AWARDED TO TSS ON AUGUST 10, 1970, FOR A ONE-YEAR
PERIOD. THE AIR FORCE CONTENDS THAT AWARD WAS MADE, WITHOUT CONDUCTING
WRITTEN OR ORAL DISCUSSIONS, ON THE BASIS OF THE PROPOSAL AS SUBMITTED.
AS IS FURTHER INDICATED BELOW, YOU DISPUTE THE POSITION THAT NO
DISCUSSIONS WERE HELD BEFORE AWARD. ESSENTIALLY, IT IS YOUR POSITION
THAT AWARD SHOULD HAVE BEEN MADE TO YOUR FIRM AS TECHNICALLY ACCEPTABLE,
CAPABLE OF PERFORMING THE CONTRACT AND RESULTING IN THE LOWEST COST TO
THE GOVERNMENT.
WHILE PRICE IS ALWAYS A FACTOR IN GOVERNMENT PROCUREMENT, IT IS NOT
NECESSARILY THE DOMINANT FACTOR IN NEGOTIATION. SEE 44 COMP. GEN. 439
(1965). IT IS PROPER TO CONSIDER TECHNICAL AND OTHER FACTORS IN
ADDITION TO PRICE WHICH ARE SET OUT IN THE SOLICITATION. WHILE THE
RELATIVE ORDER OF IMPORTANCE OF THE EVALUATION FACTORS SHOULD HAVE BEEN
INCLUDED IN THE SOLICITATION, OFFERORS WERE ADVISED OF THE IMPORTANCE
ATTACHED TO THE EVALUATION OF TECHNICAL PERSONNEL.
YOUR SUPPLEMENTAL LETTER OF JANUARY 5, 1971, HAS RAISED THE FOLLOWING
POINTS WITH RESPECT TO YOUR PROTEST:
"1. NEGOTIATIONS WERE CONDUCTED WITH SYNERGY WITHOUT QUESTION.
"2. TECHNOLOGY/SCIENTIFIC DID NOT RECEIVE A CONTRACT BEFORE PROTEST
WAS MADE.
"3. THE TECHNICAL EVALUATION TEAM OR MEMBERS WERE 'FULLY COGNIZANT
OF THE PRICING DATA'.
"4. THE PRICING DIFFERENCE WAS A TECHNICAL EVALUATION FACTOR IN
SELECTION.
"5. UNIQUENESS OF THE EQUIPMENT HAS NOT IN PAST YEARS BEEN A
SIGNIFICANT FACTOR IN AWARDING THIS PROCUREMENT COMPETITIVELY.
"6. SYNERGY PROPOSAL WAS CONSIDERED TECHNICALLY ACCEPTABLE AND
CAPABLE OF REQUIRED PERFORMANCE.
"7. PERSONNEL PROPOSED DO MEET THE QUALIFICATIONS OF THE
SOLICITATION.
"8. RECENT GAO DECISION B-169148 RULED IN FAVOR OF THE LOW BIDDER IN
A SIMILAR CASE." THE LETTER OF JANUARY 5 HAS ALSO FURNISHED OUR OFFICE
WITH INFORMATION ON CERTAIN EMPLOYEES OF YOUR CONCERN.
WITH RESPECT TO POINT 1, THERE IS NOTHING IN THE RECORD TO INDICATE
THAT NEGOTIATIONS WERE CONDUCTED WITH EITHER YOUR CONCERN OR TSS OR THAT
AWARDS WERE NOT MADE ON THE BASIS OF INITIAL PROPOSALS.
IN REGARD TO POINT 2, THE CONTRACTING OFFICER'S STATEMENT ADVISES
THAT A VERBAL PROTEST FROM YOUR CONCERN WAS RECEIVED ON AUGUST 10, 1970,
WHICH APPARENTLY WAS ALMOST SIMULTANEOUS WITH THE AWARD TO TSS. IT IS
AIR FORCE'S CONTENTION THAT AWARD WAS MADE BEFORE YOUR PROTEST. IN THE
CIRCUMSTANCES, WHETHER YOUR PROTEST WAS BEFORE OR AFTER AWARD DOES NOT
SEEM TO HAVE A MATERIAL EFFECT ON THE RESOLUTION OF THE ISSUES BEFORE
OUR OFFICE; CONSEQUENTLY, WE DO NOT FIND IT NECESSARY TO GIVE FURTHER
CONSIDERATION TO THIS CONTENTION.
CONCERNING POINT 3, THE CONTRACTING OFFICER'S "MEMO FOR FILE" ADMITS
THIS CONTENTION. THE CONTRACTING OFFICER'S "MEMO" GOES ON TO STATE THAT
IT WAS THE BEST ENGINEERING JUDGMENT OF THE TECHNICAL PERSONNEL THAT
"AWARD TO SYNERGY WOULD NOT BE IN THE BEST INTEREST OF THE GOVERNMENT
FROM A COST STANDPOINT AND WOULD IN FACT COST IN EXCESS OF THIS FIGURE
IN TERMS OF DELAYS TO SENSITIVE R&D PROGRAMS." WHILE THE TECHNICAL
PERSONNEL WERE AWARE OF THE COST DIFFERENCE THERE IS NO INDICATION THAT
SUCH KNOWLEDGE WAS PREJUDICIAL TO YOUR CONCERN.
THERE IS NOTHING IN THE RECORD TO SUPPORT CONTENTION 4. A LETTER
FROM THE TECHNICAL SUPPORT DIVISION DATED JULY 24, 1970, SEEMS TO
ESTABLISH THAT THE PRICING DIFFERENCE WAS NOT CONSIDERED IN THE
TECHNICAL EVALUATION.
WE HAVE NO SPECIFIC INFORMATION ON CONTENTION 5. HOWEVER, EVEN
CONCEDING THIS CONTENTION WOULD NOT REFUTE THE VIEW IN THE CONTRACTING
OFFICER'S "MEMO" THAT CURRENT CHANGES HAD BEEN MADE TO ADAPT THE
EQUIPMENT TO CHANGING LABORATORY REQUIREMENTS AND GIVING IT UNIQUE
FEATURES.
WITH REGARD TO CONTENTION 6, THE RECORD INDICATES THAT THE EVALUATION
PANEL FOUND SYNERGY'S OVERALL PROPOSAL ACCEPTABLE BUT NOTICEABLY WEAK IN
PERSONNEL QUALIFICATIONS.
IN CONTENTION 7, YOU HAVE TAKEN ISSUE WITH AIR FORCE'S DETERMINATION
REGARDING THE QUALIFICATIONS OF YOUR PERSONNEL IN TERMS OF THE CRITERIA
SET FORTH IN THE RFP. WE ASSUME ALL OF THE INFORMATION IN YOUR LETTER
OF JANUARY 5, 1971, HAD BEEN FURNISHED TO THE AIR FORCE AT THE TIME OF
ITS DETERMINATION REGARDING THE QUALIFICATIONS OF YOUR PERSONNEL. SUCH
JUDGMENTAL DETERMINATIONS ARE NOT QUESTIONED BY OUR OFFICE UNLESS SHOWN
TO BE ARBITRARY OR WITHOUT A REASONABLE BASIS. WE DO NOT FIND THESE
FACTORS IN THIS CASE.
REGARDING B-169148, OCTOBER 6, 1970, 50 COMP. GEN. ___, WHICH YOU
HAVE CITED IN CONTENTION 8, IN SUPPORT OF THE POSITION THAT AWARD SHOULD
HAVE BEEN MADE TO YOUR CONCERN, WE FIND THAT THIS CITED DECISION IS
DISTINGUISHABLE FROM THE FACTS PRESENTLY UNDER CONSIDERATION.
THE CITED CASE INVOLVED A SOLICITATION OF COST-PLUS-A-FIXED-FEE
PROPOSALS FOR MAINTENANCE OF A HYPERSONIC WIND TUNNEL FACILITY. ONE
OFFER WAS $742,486 AND ANOTHER WAS $719,800. IN THAT CASE THE AWARD WAS
MADE TO THE HIGHER OFFEROR AND THE OFFEROR SUBMITTING THE LOWER PRICE
PROTESTED THE AWARD. PURSUANT TO THE TECHNICAL EVALUATION IN THAT CASE,
THE HIGHER PRICED PROPOSAL WAS GIVEN 84 POINTS AND THE LOWER WAS GIVEN
78 POINTS EVEN THOUGH IT WAS DETERMINED THAT THE TWO OFFERORS WERE
ESSENTIALLY EQUAL AS TO TECHNICAL ABILITY.
IN SUCH CIRCUMSTANCES, IT WAS HELD THAT THE LOWER OFFER REPRESENTED
AN ADVANTAGE TO THE GOVERNMENT WHICH COULD NOT BE IGNORED AND THAT THE
CONCEPTS EXPRESSED IN ARMED SERVICES PROCUREMENT REGULATION (ASPR)
3-805.2 AND 4-106.5(A), THAT PRICE IS NOT THE CONTROLLING FACTOR IN THE
AWARD OF COST-REIMBURSEMENT AND RESEARCH AND DEVELOPMENT CONTRACTS
RELATE TO SITUATIONS WHERE THE FAVORED OFFEROR IS SIGNIFICANTLY SUPERIOR
IN TECHNICAL ABILITY OVER LOWER PRICED, LESS QUALIFIED OFFERORS.
WE AGREE THAT THE POINT RANGES IN THE TWO SITUATIONS ARE NOT
RADICALLY DIFFERENT. HOWEVER, IN THE EARLIER CASE THE CONTRACTING
ACTIVITY SPECIFICALLY DETERMINED THAT THE DIFFERENCES IN THE TECHNICAL
PROPOSALS, WHICH WERE REGARDED AS INSIGNIFICANT, DID NOT JUSTIFY PAYING
A PRICE DIFFERENTIAL. IT WAS FURTHER STATED THAT THE FIRM RECEIVING THE
78 POINT SCORE WAS QUITE CAPABLE OF PERFORMING THE REQUIRED WORK AND
THAT TO PLACE UNDUE EMPHASIS ON THE HIGHER SCORE "WOULD HAVE BEEN
SUPERFLUOUS" TO THE AGENCY'S REQUIREMENTS AND "DID NOT WARRANT THE
EXPENDITURE OF ADDITIONAL FUNDS." IN CONTRAST, THE FINDINGS IN THIS CASE
WERE THAT YOUR PROPOSAL AND THE TSS PROPOSAL WERE NOT EQUAL AND THAT
ACCEPTANCE OF THE HIGHER PRICED OFFER WAS MORE ADVANTAGEOUS TO THE
GOVERNMENT.
UNDER ASPR 3-805.1(A)(V), IMPLEMENTING 10 U.S.C. 2304(G), THE
CONTRACTING OFFICER HAS AUTHORITY TO MAKE AN AWARD ON THE BASIS OF
INITIAL PROPOSALS RECEIVED WITHOUT FURTHER DISCUSSION WHERE IT CAN BE
SHOWN FROM THE EXISTENCE OF ADEQUATE COMPETITION OR ACCURATE PRIOR COST
EXPERIENCE THAT ACCEPTANCE OF THE MOST FAVORABLE INITIAL PROPOSAL
WITHOUT DISCUSSION WOULD RESULT IN FAIR AND REASONABLE PRICES, PROVIDED
THE REQUEST FOR PROPOSALS NOTIFIES ALL OFFERORS OF THIS POSSIBILITY. AS
INDICATED, THE RFP ADVISED OFFERORS THAT AWARD MIGHT BE MADE ON THE
BASIS OF INITIAL PROPOSALS AND SINCE THE OTHER REQUIRED ELEMENTS WERE
FOUND TO EXIST, WE FIND NO BASIS TO OBJECT TO THE AWARD FOR FAILURE TO
CONDUCT WRITTEN OR ORAL DISCUSSIONS WITH THE OFFERORS. SEE B-168085,
DECEMBER 29, 1969.
FOR THESE REASONS YOUR PROTEST IS DENIED.
B-170633(2), MAY 3, 1971
BID PROTEST - NEGOTIATIONS - EVALUATION FORMULA
WITH RESPECT TO THE PROCUREMENT IN CONNECTION WITH WHICH SYNERGY,
INC., LODGED A PROTEST, THE COMP. GEN. HAS POINTED OUT (B-169148, 50
COMP. GEN. ___) THE NECESSITY OF FURNISHING ADEQUATE INFORMATION TO
PROSPECTIVE OFFERORS OF THE GOVERNMENT'S NEEDS. THEREFORE, OFFERORS
SHOULD BE ADVISED OF THE RELATIVE IMPORTANCE TO BE ATTACHED TO EACH
EVALUATION FACTOR.
TO MR. SECRETARY:
REFERENCE IS MADE TO THE LETTER OF OCTOBER 28, 1970, AFSPPLA, WITH
ATTACHMENTS, AND LETTER OF MARCH 30, 1971, FROM WRIGHT-PATTERSON AIR
FORCE BASE, PMB, CONCERNING A PROTEST FROM SYNERGY, INCORPORATED,
AGAINST THE AWARD OF A CONTRACT TO ANOTHER CONCERN UNDER REQUEST FOR
PROPOSALS NO. F 33601-71-R-0002, ISSUED BY THE PROCUREMENT DIVISION,
WRIGHT-PATTERSON AIR FORCE BASE, OHIO. WE ARE ENCLOSING A COPY OF OUR
DECISION DENYING THE PROTEST.
IN B-169148, OCTOBER 6, 1970, 50 COMP. GEN. ___, WE POINTED OUT THAT
NO SPECIFIC EVALUATION FACTORS DIRECTLY PERTINENT TO THE PROCUREMENT
WERE SET OUT IN THE RFP AND WE ADVISED THAT THE NECESSITY FOR FURNISHING
ADEQUATE INFORMATION TO PROSPECTIVE OFFERORS OF THE GOVERNMENT'S NEEDS
AND REQUIREMENTS IS IMPLICIT IN THE PROCUREMENT OF GOODS AND SERVICES,
CITING ASPR 3-501(A). WE ALSO CITED 49 COMP. GEN. 229 (1969) WHICH HELD
THAT IF A POINT EVALUATION FORMULA IS TO BE USED, OFFERORS SHOULD BE
INFORMED AS TO THE EVALUATION FACTORS AND THE RELATIVE IMPORTANCE TO BE
ATTACHED TO EACH FACTOR. THE TECHNICAL EVALUATION REPORT ON THE RFP
INDICATES THAT A POINT EVALUATION FORMULA WAS USED. HOWEVER, OFFERORS
WERE NOT ADVISED OF THE RELATIVE IMPORTANCE TO BE ATTACHED TO EACH
FACTOR. ALSO, WE HAVE HELD THAT A PREDETERMINED SCORE SHOULD NOT BE
USED AS A BASIS FOR DETERMINING WHETHER PROPOSALS ARE WITHIN THE RANGE
OF ACCEPTABILITY. B-169645(1), JULY 24, 1970, 50 COMP. GEN. 59. WE ARE
BRINGING THESE MATTERS TO YOUR ATTENTION FOR APPROPRIATE ACTION IN
FUTURE PROCUREMENTS.
B-171550, B-171565, B-171629, B-171631, MAY 3, 1971
BID PROTEST - SUSPENSION FROM DOING BUSINESS - FRAUD
ADVISING WITH RESPECT TO THE PROTEST OF BOSTON PNEUMATICS AGAINST THE
OPENING OF BIDS UNDER VARIOUS SOLICITATIONS BECAUSE IT WAS NOT GIVEN AN
OPPORTUNITY TO SUBMIT BIDS, THAT IT WAS SUSPENDED, IN ACCORDANCE WITH
REGULATIONS FROM DOING BUSINESS WITH THE FEDERAL SUPPLY AGENCY.
PROTESTANT WAS SUSPENDED FROM DOING BUSINESS WITH THE GOVERNMENT IN
ACCORDANCE WITH SECTION 1-1.605-1 OF THE FPR BECAUSE GSA HAD ADEQUATE
EVIDENCE UPON WHICH TO SUSPECT IT OF FRAUD IN PERFORMANCE OF A CONTRACT.
WHILE THE INVESTIGATION BY THE JUSTICE DEPARTMENT MUST BE COMPLETED
WITHIN 12 MONTHS, A CONTINUANCE OF THE SUSPENSION IS ALLOWED WHEN
REQUESTED AS WAS DONE IN THIS CASE, TO COMPLETE THE INVESTIGATION.
TO STASSEN, KEPHART AND KOSTOS
FURTHER REFERENCE IS MADE TO YOUR TELEGRAMS OF DECEMBER 15, 17 AND
31, 1970, PROTESTING ON BEHALF OF BOSTON PNEUMATICS (BP), AGAINST THE
OPENING OF BIDS UNDER SOLICITATIONS NOS. FPNTP-B8-31815;
6PR-W-65315-B-F; 6PR-W-59744-HH-F; AND 6PR-W-61229-KI-F, RESPECTIVELY,
BECAUSE BP WAS NOT SENT COPIES OF THE INVITATIONS ISSUED BY THE GENERAL
SERVICES ADMINISTRATION (GSA) OR GIVEN OPPORTUNITIES TO SUBMIT BIDS.
IN SUBSEQUENT LETTERS OF DECEMBER 30, 1970, JANUARY 15, AND FEBRUARY
24, 1971, YOU STATE THAT ALTHOUGH BP WAS ARBITRARILY SUSPENDED FROM
BIDDING ABOUT A YEAR AGO, BP HAS NOT BEEN ADVISED OF THE CHARGES PLACED
AGAINST IT, AND HAS NOT BEEN GIVEN A CHANCE TO BE HEARD. YOU APPEAL TO
OUR OFFICE TO ARRANGE A MEETING AMONG ALL INTERESTED PARTIES SO THAT THE
CHARGES AND THE FACTS MAY BE PLACED ON THE TABLE TO BE JUDGED FAIRLY.
IN ITS REPORT TO OUR OFFICE, GSA ADVISES THAT BY LETTERS DATED
FEBRUARY 11, 1970, FORWARDED BY CERTIFIED MAIL, BOTH BP AND ITS
PRESIDENT WERE ADVISED THAT BOTH WERE, EFFECTIVE THAT DATE, SUSPENDED
FROM DOING BUSINESS WITH THE FEDERAL SUPPLY SERVICE IN ACCORDANCE WITH
SECTION 1-1.605-1 OF THE FEDERAL PROCUREMENT REGULATION (FPR), BECAUSE
GSA HAD ADEQUATE EVIDENCE UPON WHICH TO SUSPECT THAT BP WAS GUILTY OF
FRAUD IN THE PERFORMANCE OF A GSA CONTRACT. ON FEBRUARY 25, 1970, THE
MATTER WAS REFERRED TO THE DEPARTMENT OF JUSTICE FOR INVESTIGATION,
WHICH UNDER THE REGULATIONS, MUST BE COMPLETED WITHIN 12 MONTHS UNLESS
PROSECUTIVE ACTION HAS BEEN INITIATED BY THE DEPARTMENT OF JUSTICE OR AN
ASSISTANT ATTORNEY GENERAL REQUESTS CONTINUANCE OF THE SUSPENSION. IN
THIS REGARD, WE ARE ADVISED THAT SUCH A REQUEST WAS MADE ON FEBRUARY 8,
1971, FOR AN EXTENSION OF SIX MONTHS FROM FEBRUARY 11, 1971.
THE APPLICABLE REGULATIONS CONCERNING THE SUSPENSION OF BIDDERS ARE
SET OUT IN SUBPART 1-1.605 OF THE FEDERAL PROCUREMENT REGULATIONS (FPR).
THOSE REGULATIONS PROVIDE THAT AN AGENCY MAY SUSPEND A FIRM OR
INDIVIDUAL SUSPECTED, UPON ADEQUATE EVIDENCE, OF COMMITTING A FRAUD IN
THE PERFORMANCE OF A GOVERNMENT CONTRACT, OR ANY OTHER OFFENSE
EVIDENCING A LACK OF BUSINESS INTEGRITY OR BUSINESS HONESTY WHICH
SERIOUSLY AND DIRECTLY AFFECTS THE QUESTION OF PRESENT RESPONSIBILITY AS
A GOVERNMENT CONTRACTOR. SUBPART 1-1.602 OF FPR PROVIDES THAT BIDS WILL
NOT BE SOLICITED OR CONSIDERED FROM SUCH FIRMS.
WHILE THE LENGTH OF TIME DURING WHICH BP HAS BEEN SUSPENDED WITHOUT A
HEARING MAKES YOUR CONCERN UNDERSTANDABLE, THE PERIOD OF SUSPENSION IS
STILL WITHIN THAT SET OUT IN THE REGULATIONS. IN VIEW THEREOF, AND
SINCE THE DELAY APPEARS TO BE ATTRIBUTABLE TO THE DEPARTMENT OF JUSTICE
WHICH HAS REQUESTED AN ADDITIONAL SIX MONTHS TO COMPLETE ITS
INVESTIGATION, WE DO NOT BELIEVE THAT INTERVENTION BY THIS OFFICE WOULD
BE JUSTIFIED AT THIS TIME.
CONSEQUENTLY, YOUR REQUEST MUST BE DENIED.
B-172180, MAY 3, 1971
CIVILIAN EMPLOYEE - REDUCED PER DIEM
ADVANCED DECISION HOLDING THAT RUDOLPH C. BARTZ, AN EMPLOYEE OF THE
DEPARTMENT OF THE ARMY, MAY BE PAID AN ADDITIONAL $13.20 PER DIEM
INCIDENT TO ATTENDING A TRAINING COURSE AT FORT LEE, VIRGINIA.
BECAUSE PARAGRAPH C8101-2H OF THE JTR IN EFFECT AT THE TIME OF TRAVEL
CONTAINED NO PRESCRIBED REDUCED RATE PERTAINING TO FORT LEE AND DID NOT
PROVIDE AUTHORITY FOR THE COMMANDING OFFICER TO INDEPENDENTLY ESTABLISH
A REDUCED PER DIEM RATE, THE $11.80 PER DAY PAID CLAIMANT WAS IMPROPER.
CLAIMANT WAS ENTITLED TO $25 PER DIEM IN LIEU OF SUBSISTENCE AND
THEREFORE THE VOUCHER FOR AN ADDITIONAL $13.20 PER DAY MAY BE PAID.
TO MR. EUGENE J. ROGERS:
REFERENCE IS MADE TO YOUR LETTER OF OCTOBER 6, 1970, REFERENCE
SMUAP-CA, FORWARDED HERE BY THE PER DIEM, TRAVEL AND TRANSPORTATION
ALLOWANCE COMMITTEE ON MARCH 11, 1971, PDTATAC CONTROL NO. 71-15, FOR
AN ADVANCE DECISION WHETHER A VOUCHER COVERING ADDITIONAL PER DIEM MAY
BE PAID TO MR. RUDOLPH C. BARTZ, AN EMPLOYEE OF THE DEPARTMENT OF THE
ARMY, INCIDENT TO ATTENDING A TRAINING COURSE.
THE INFORMATION OF RECORD SHOWS THAT MR. BARTZ BY TRAVEL ORDER DATED
JANUARY 13, 1970, WAS AUTHORIZED TO TRAVEL FROM HIS HEADQUARTERS IN
JOILET, ILLINOIS, TO FORT LEE, VIRGINIA, TO ATTEND A TRAINING COURSE FOR
APPROXIMATELY 135 DAYS. PROVISION FOR PER DIEM AUTHORIZED IN ACCORDANCE
WITH THE JOINT TRAVEL REGULATIONS WAS MARKED OUT AND ANOTHER RATE OF PER
DIEM WAS SPECIFIED IN REMARKS AS FOLLOWS: "EXPENDITURES NOT TO EXCEED
$1,836.00 OR 11.80 PER DAY CHARGEABLE TO USALMC FUNDS CITED IN BLOCK
19." THE FOLLOWING PHRASE UNDER REMARKS WAS MARKED OUT: "PER DIEM OF
$13.20 IS CHARGEABLE TO APSA FUNDS NOT TO EXCEED $1,755.60." MR. BARTZ
OCCUPIED COMMERCIAL QUARTERS AND WAS REIMBURSED AT A PER DIEM RATE OF
$11.80 AND IS NOW CLAIMING AN ADDITIONAL PER DIEM RATE OF $13.20.
IT IS STATED THAT MR. BARTZ ELECTED TO LIVE OFF-POST BEFORE THE
OFFICIAL TRAVEL AUTHORIZATION WAS PROCESSED, AND OCCUPANCY OF GOVERNMENT
QUARTERS WAS NOT ONE OF THE REQUIREMENTS FOR ATTENDING THE COURSE.
SINCE THE EMPLOYEE'S FAMILY ACCOMPANIED HIM FOR THE TENURE OF HIS
TEMPORARY DUTY, THE DEFENSE SUPPLY AGENCY DETERMINED THAT THE MOST
REASONABLE RATE TO ALLOW UNDER THE CIRCUMSTANCES WAS $11.80 PER DAY.
THIS REPRESENTED $4 FOR HOUSING, $6 FOR FOOD, AND $1.80 FOR INCIDENTALS
FOR THE EMPLOYEE.
PARAGRAPH C 8101-2H OF THE JOINT TRAVEL REGULATIONS, VOLUME 2, CHANGE
53, DATED FEBRUARY 1, 1970, IN EFFECT AT THE TIME OF THE TRAVEL PROVIDES
AS FOLLOWS:
"H. PER DIEM RATES AT CERTAIN TRAINING COURSES.
SPECIFIC PER DIEM RATES ARE PRESCRIBED IN APPENDIX C, PART III, WHICH
ARE APPLICABLE WHILE ATTENDING TRAINING COURSES AT DESIGNATED LOCATIONS.
THE RATES ARE ESTABLISHED IN ACCORDANCE WITH PAR. C 8051-5 AND AUTHORITY
CONTAINED IN 5 U.S.C. 4109."
PARAGRAPH C 8051-5 IN EFFECT AT THE TIME OF THE TRAVEL PROVIDED THAT
THE ACTIVITY RESPONSIBLE FOR ARRANGING THE SCHOOLING WOULD PRESCRIBE THE
APPROPRIATE PER DIEM RATE. THE INVITATIONS, ANNOUNCEMENTS, OR
DIRECTIVES RELATING THERETO WOULD INCLUDE INFORMATION AND INSTRUCTIONS
REGARDING THE AVAILABILITY OF LOCAL FACILITIES AND ARRANGEMENTS MADE FOR
THEIR USE. PARAGRAPH C 8051-5 DOES NOT PROVIDE AUTHORITY FOR THE LOCAL
COMMANDING OFFICER TO INDEPENDENTLY ESTABLISH A REDUCED PER DEIM RATE
INCIDENT TO ATTENDANCE AT A TRAINING COURSE, BUT PROVIDES THAT THE "RATE
MAY BE THAT ESTABLISHED IN APPENDIX C FOR THE LOCALITY INVOLVED, OR A
DIFFERENT RATE IF SPECIAL ARRANGEMENTS HAVE BEEN MADE IN ADVANCE FOR
QUARTERS AND MEALS AT A SPECIFIC RATE." DURING THE PERIOD IN QUESTION,
THERE WAS NO PRESCRIBED REDUCED RATE CITED IN APPENDIX C, PART III,
PERTAINING TO FORT LEE, AND WE FIND NOTHING IN THE RECORD TO INDICATE
THAT SPECIAL ARRANGEMENTS HAD BEEN MADE FOR QUARTERS AND MEALS.
PARAGRAPH C 8101 IN EFFECT DURING THE PERIOD COVERED BY THE VOUCHER
HERE INVOLVED PRESCRIBED A PER DIEM IN LIEU OF SUBSISTENCE RATE OF $25
PER DAY FOR ALL TRAVEL AND TEMPORARY DUTY. SUCH RATE MUST BE VIEWED AS
APPLICABLE UNLESS A REDUCED RATE HAD BEEN ESTABLISHED AS AUTHORIZED BY
THE REGULATIONS. AS ABOVE INDICATED, A REDUCED RATE HAD NOT BEEN DULY
PRESCRIBED.
IN OUR DECISION B-168758 OF FEBRUARY 12, 1970, 49 COMP. GEN. 493, WE
HELD THAT REGULATIONS OF THE DEFENSE CONTRACT AUDIT AGENCY, DEFENSE
SUPPLY AGENCY, PROVIDING FOR THE PAYMENT OF A PER DIEM LESS THAN $25,
COULD NOT BE GIVEN EFFECT SINCE THEY WERE NOT ISSUED IN ACCORD WITH
AUTHORITY CONTAINED IN THE JOINT TRAVEL REGULATIONS. WE SEE NO REASON
WHY THAT CONCLUSION WOULD NOT BE APPLICABLE HERE.
THEREFORE, THE VOUCHER WHICH IS RETURNED HEREWITH MAY BE PAID IF
OTHERWISE CORRECT.
B-172545, MAY 3, 1971
CONTRACTS - MISTAKE IN BID - CANCELLATION
ADVISING THAT CONTRACT MADE WITH GABRIEL CHEMICALS UNDER A
SOLICITATION ISSUED BY THE FEDERAL SUPPLY SERVICE FOR 946 PAILS OF
GUTHION 20% EC, INSECTICIDE, TO BE PACKED IN 55.5 LBS, NET IN NEW 22
GAUGE STEEL PAILS, MAY BE CANCELLED BECAUSE OF AN ERROR IN GABRIEL'S
OFFER.
THE MISTAKE IS GABRIEL'S BID (VIZ., BASING ITS OFFER ON FURNISHING
REGULAR GUTHION 2E, A STOCK ITEM, RATHER THAN GUTHION 20% EC) SHOULD
HAVE BEEN APPARENT TO THE CONTRACTING OFFICER SINCE GABRIEL SPECIFIED IN
ITS BID THE GROSS WEIGHT PER PAIL AS 52 POUNDS AND OBVIOUSLY COULD NOT
PUT IN 55.5 LBS. OF NET CONTENTS AND GET A PAIL WEIGHING 52 LBS. GROSS.
THEREFORE, THE CONTRACTING OFFICER IS CHARGED WITH NOTICE OF THE ERROR
AND THE CONTRACT MAY BE CANCELLED WITHOUT LIABILITY TO GABRIEL.
TO MR. KUNZIG:
REFERENCE IS MADE TO LETTER DATED APRIL 6, 1971, WITH ENCLOSURES,
FROM YOUR GENERAL COUNSEL, REQUESTING A DECISION AS TO THE ACTION TO BE
TAKEN CONCERNING AN ERROR ALLEGED BY GABRIEL CHEMICALS, LTD., TO HAVE
BEEN MADE IN ITS OFFER ON ITEM 00321-2 UPON WHICH CONTRACT NO.
GS-OOS-04105 WAS BASED IN PART.
SOLICITATION NO. FPH-J-45442-N-2-5-71, ISSUED ON JANUARY 4, 1971, BY
THE FEDERAL SUPPLY SERVICE, SPECIAL PROGRAMS DIVISION - FPH, WASHINGTON,
D.C., INVITED OFFERS UNDER ITEM 00321-2 FOR 946 PAILS OF AZINPHON-METHYL
(GUTHION), 20 PERCENT EMULSIFIABLE CONCENTRATE (EC), INSECTICIDE, TO BE
PACKED IN "55.5 LBS., NET IN NEW 22 GAUGE 6.6 U.S. GAL. COLD ROLLED
STEEL PAILS." THE SOLICITATION REQUESTED OFFERS F.A.S. U.S. PORT OF
SHIPMENT AND PROVIDED THAT OFFERS WOULD BE EVALUATED AND AWARD MADE,
ITEM BY ITEM, ON BASIS OF THE LOWEST DELIVERED COST TO BANGKOK,
THAILAND. GUARANTEED GROSS WEIGHTS AND MEASUREMENTS WERE TO BE
FURNISHED BY OFFERORS FOR EVALUATION PURPOSES.
IT IS REPORTED THAT OFFERS ON ITEM 00321-2 WERE RECEIVED FROM THE
CHEMAGRO CHEMICAL CORPORATION AND GABRIEL CHEMICALS LTD. AND WERE
EVALUATED IN THE FOLLOWING MANNER:
GUARANTEED EVALUATED
(946 PAILS) GROSS WEIGHT TO
UNIT PRICE F.A.S. U.S. PORT PER PAIL DESTINATION
CHEMAGRO $44.22 NET $41,832.12 (S.F. OR L.A., 64 LBS. $44,679
CALIFORNIA)
GRABRIEL 36.00 34,056.00 (N.Y., N.Y.) 52 LBS. 36,875
(1/4-20 DAYS) THEREAFTER, ON FEBRUARY 25, 1971, GABRIEL WAS
GS-OOS-04105 FOR FURNISHING ITEM 00321-2 AND ANOTHER ITEM.
IT IS REPORTED THAT ON MARCH 1, 1971, GABRIEL ADVISED THE PROCURING
ACTIVITY BY TELEPHONE THAT A MISTAKE HAD BEEN MADE IN BIDDING ON ITEM
00321-2 IN THAT IT WAS ERRONEOUSLY BASED ON FURNISHING REGULAR GUTHION
2E, A STOCK ITEM, RATHER THAN GUTHION 20% EC. IN A CONFIRMING LETTER
DATED MARCH 2, 1971, GABRIEL POINTED OUT THAT IT SPECIFIED IN ITS BID
THE GROSS WEIGHT PER PAIL FOR ITEM 00321-2 AS 52 POUNDS AND STATED:
"OBVIOUSLY WE COULD NOT PUT 55.5 LBS. OF NET CONTENTS AND GET A PAIL
WEIGHING 52 LBS. GROSS." GABRIEL REQUESTED THAT IT BE RELIEVED OF THE
OBLIGATION TO FURNISH GUTHION 20% EC UNDER ITEM 00321-2. IN THIS
CONNECTION, IT IS REPORTED THAT THE CHEMAGRO CHEMICAL CORPORATION, THE
MANUFACTURER OF GUTHION 20% EC FOR EXPORT ONLY, HAS ADVISED THE
PROCURING ACTIVITY THAT GUTHION 20% EC WILL NOT BE MADE AVAILABLE BY
CHEMAGRO ON THE DOMESTIC MARKET TO GABRIEL OR TO ANY OTHER DEALER.
THE GUARANTEED WEIGHTS FURNISHED BY OFFERORS WERE USED BY THE
CONTRACTING OFFICER IN COMPUTING THE OCEAN FREIGHT CHARGES. IN HIS
REPORT OF MARCH 12, 1971, THE CONTRACTING OFFICER STATES THAT THE
DIFFERENCE BETWEEN THE GROSS WEIGHTS FURNISHED BY THE TWO OFFERORS FOR
ITEM 00321-2 AND THE FACT THAT IT IS IMPOSSIBLE TO PACK 55.5 POUNDS NET
OF MATERIAL IN A 22-GAUGE STEEL CONTAINER AND ARRIVE AT A GROSS WEIGHT
OF 52 POUNDS WAS SO APPARENT AS TO HAVE CHARGED HIM WITH NOTICE OF THE
PROBABILITY OF ERROR IN GABRIEL'S OFFER ON THAT ITEM. WE ALSO ARE OF
THE OPINION THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE
PROBABILITY OF ERROR IN GABRIEL'S OFFER ON ITEM 00321-2 AND,
CONSEQUENTLY, THE OFFER SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING
THE COMPANY TO VERIFY ITS OFFER.
ACCORDINGLY, ITEM 00321-2 OF CONTRACT NO. GS-OOS-04105 MAY BE
CANCELLED WITHOUT LIABILITY TO GABRIEL CHEMICALS LTD.
THE ENCLOSURES SUBMITTED WITH THE LETTER OF APRIL 6, 1971, ARE
RETURNED AS REQUESTED.
B-142011, APR 30, 1971
COMMODITY CREDIT CORPORATION - UPLAND COTTON
ADVISING THAT THE LEGISLATIVE HISTORY OF SECTION 610 OF THE
AGRICULTURAL ACT OF 1970 MAKES CLEAR THAT $10,000,000 MAY BE MADE
AVAILABLE EACH YEAR BY THE COMMODITY CREDIT CORP., PURSUANT TO THAT
SECTION TO FINANCE A PROGRAM FOR THE MARKET AND DEVELOPMENT OF UPLAND
COTTON WITHOUT PROOF OF ACTUAL SAVINGS OF THAT AMOUNT RESULTING FROM THE
APPLICATION OF THE PAYMENT LIMITATION UNDER THAT ACT ON PAYMENTS TO
COTTON PRODUCERS.
TO MR. SECRETARY:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 5, 1971, REQUESTING OUR
DECISION AS TO WHETHER $10,000,000 MAY BE MADE AVAILABLE EACH YEAR BY
THE COMMODITY CREDIT CORPORATION, PURSUANT TO THE SECOND SENTENCE OF
SECTION 610 OF THE AGRICULTURAL ACT OF 1970, TO FINANCE A PROGRAM FOR
MARKET, DEVELOPMENT, RESEARCH, AND SALES PROMOTION FOR UPLAND COTTON
UNDER SUCH SECTION, WITHOUT PROOF OF ACTUAL SAVINGS OF THAT AMOUNT
RESULTING FROM THE APPLICATION OF THE PAYMENT LIMITATION UNDER THAT ACT
ON PAYMENTS TO COTTON PRODUCERS.
SECTION 610 OF THE AGRICULTURAL ACT OF 1970, PUBLIC LAW 91-524,
APPROVED NOVEMBER 30, 1970, 84 STAT. 1378, READS AS FOLLOWS:
"SEC. 610. THE COMMODITY CREDIT CORPORATION, IN FURTHERANCE OF ITS
POWERS AND DUTIES UNDER SUBSECTIONS (E) AND (F) OF SECTION 5 OF THE
COMMODITY CREDIT CORPORATION CHARTER ACT, SHALL, THROUGH THE COTTON
BOARD ESTABLISHED UNDER THE COTTON RESEARCH AND PROMOTION ACT, AND UPON
APPROVAL OF THE SECRETARY, ENTER INTO AGREEMENTS WITH THE CONTRACTING
ORGANIZATION SPECIFIED PURSUANT TO SECTION 7(G) OF THAT ACT FOR THE
CONDUCT, IN DOMESTIC AND FOREIGN MARKETS, OF MARKET DEVELOPMENT,
RESEARCH OR SALES PROMOTION PROGRAMS AND PROGRAMS TO AID IN THE
DEVELOPMENT OF NEW AND ADDITIONAL MARKETS, MARKETING FACILITIES AND USES
FOR COTTON AND COTTON PRODUCTS, INCLUDING PROGRAMS TO FACILITATE THE
UTILIZATION AND COMMERCIAL APPLICATION OF RESEARCH FINDINGS. EACH YEAR
THE AMOUNT AVAILABLE FOR SUCH AGREEMENTS SHALL BE THAT PORTION OF THE
FUNDS (NOT EXCEEDING $10,000,000) AUTHORIZED TO BE MADE AVAILABLE TO
COOPERATORS UNDER THE COTTON PROGRAM FOR SUCH YEAR BUT WHICH IS NOT PAID
TO PRODUCERS BECAUSE OF A STATUTORY LIMITATION ON THE AMOUNTS OF SUCH
FUNDS PAYABLE TO ANY PRODUCER. THE SECRETARY IS AUTHORIZED TO DEDUCT
FROM FUNDS AVAILABLE FOR PAYMENTS TO PRODUCERS UNDER SECTION 103 OF THE
AGRICULTURAL ACT OF 1949, AS AMENDED, ON EACH OF THE 1972 AND 1973 CROPS
OF UPLAND COTTON SUCH ADDITIONAL SUMS FOR USE AS SPECIFIED ABOVE (NOT
EXCEEDING $10,000,000 FOR EACH SUCH CROP) AS HE DETERMINES DESIRABLE;
AND THE FINAL RATE OF PAYMENT PROVIDED IN SECTION 103 IF HIGHER THAN THE
RATE OF THE PRELIMINARY PAYMENT PROVIDED IN SUCH SECTION SHALL BE
REDUCED TO THE EXTENT NECESSARY TO DEFRAY SUCH COSTS. NO FUNDS MADE
AVAILABLE UNDER THIS SECTION SHALL BE USED FOR THE PURPOSE OF
INFLUENCING LEGISLATIVE ACTION OR GENERAL FARM POLICY WITH RESPECT TO
COTTON."
THE LEGISLATIVE HISTORY OF THIS PROVISION DISCLOSES THAT WHEN H.R.
18546 (THE BILL SUBSEQUENTLY ENACTED AS PUBLIC LAW 91-524) WAS PASSED BY
THE HOUSE OF REPRESENTATIVES IT CONTAINED NO PROVISIONS SUCH AS THOSE IN
SECTION 610. HOWEVER, AS PASSED BY THE SENATE, SECTION 610 CONTAINED
LANGUAGE IDENTICAL TO THAT NOW CONTAINED IN THE FIRST TWO AND THE LAST
SENTENCES OF SECTION 610.
THE COMMITTEE OF CONFERENCE INSERTED A NEW SENTENCE IMMEDIATELY
FOLLOWING THE SECOND, AND, WHILE INCLUDED IN SECTION 610 AS SET FORTH
ABOVE, IS REPEATED BELOW AS FOLLOWS:
"THE SECRETARY IS AUTHORIZED TO DEDUCT FROM FUNDS AVAILABLE FOR
PAYMENTS TO PRODUCERS UNDER SECTION 103 OF THE AGRICULTURAL ACT OF 1949,
AS AMENDED, ON EACH OF THE 1972 AND 1973 CROPS OF UPLAND COTTON SUCH
ADDITIONAL SUMS FOR USE AS SPECIFIED ABOVE (NOT EXCEEDING $10,000,000
FOR EACH SUCH CROP) AS HE DETERMINES DESIRABLE; AND THE FINAL RATE OF
PAYMENT PROVIDED IN SECTION 103 IF HIGHER THAN THE RATE OF THE
PRELIMINARY PAYMENT PROVIDED IN SUCH SECTION SHALL BE REDUCED TO THE
EXTENT NECESSARY TO DEFRAY SUCH COSTS."
THE STATEMENT OF MANAGERS ON THE PART OF THE HOUSE ACCOMPANYING THE
CONFERENCE REPORT ON THE AGRICULTURAL ACT OF 1970, HOUSE REPORT NO.
91-1594, PAGE 33, IN EXPLAINING THE PROVISIONS OF SECTION 610 STATED AS
FOLLOWS:
"IT IS THE INTENT OF THE CONFEREES THAT UNDER SECTION 610 OF THE
CONFERENCE SUBSTITUTE THE COMMODITY CREDIT CORPORATION SHALL DIVERT TO
THE COTTON BOARD NOT MORE THAN $10,000,000 ANNUALLY IN 1971, 1972, AND
1973, FROM THOSE SUMS WHICH WOULD OTHERWISE BE PAID TO COTTON PRODUCERS,
BUT FOR THE OPERATION OF PAYMENT LIMITATIONS, IN ORDER TO DEVELOP AND
EXPAND BOTH DOMESTIC AND FOREIGN MARKETS FOR UPLAND COTTON. THE ONLY
DISCRETION INTENDED FOR THE SECRETARY IN THIS REGARD IS OVER THE
APPROVAL OR DISAPPROVAL OF VARIOUS RESEARCH AND PROMOTION PROJECTS, AS
IS THE CASE UNDER THE COTTON RESEARCH AND PROMOTION ACT.
"IT IS THE CONFEREES INTENT THAT THE SECRETARY BE GIVEN DISCRETION TO
USE AN ADDITIONAL $10,000,000 ANNUALLY DURING 1972 AND 1973 FOR THE SAME
PURPOSES."
YOU STATE IN YOUR LETTER THAT IT IS YOUR BELIEF THAT THE PURPOSE OF
THE UNDERSCORED LANGUAGE IN THE ABOVE STATEMENT - TO THE EFFECT THAT THE
ONLY DISCRETION INTENDED FOR THE SECRETARY OF AGRICULTURE IN REGARD TO
THE MARKET DEVELOPMENT, RESEARCH, AND SALES PROMOTION PROGRAM FOR COTTON
WAS OVER THE APPROVAL OR DISAPPROVAL OF THE VARIOUS RESEARCH AND
PROMOTION PROJECTS - WAS TO MAKE CLEAR THE INTENTION OF THE CONFEREES
THAT IN ALL OTHER RESPECTS THE SECRETARY WAS TO HAVE NO DISCRETION
WHATSOEVER IN MAKING AVAILABLE $10,000,000 EACH YEAR FOR THE CARRYING
OUT OF APPROVED PROJECTS. THIS, YOU STATE, WOULD INCLUDE NO DISCRETION
TO WITHHOLD FUNDS FOR SUCH APPROVED PROJECTS PENDING PROOF OF ACTUAL
SAVINGS FROM THE APPLICATION OF THE PAYMENT LIMITATION ON PAYMENTS TO
COTTON PRODUCERS.
WHILE THE LANGUAGE OF SECTION 610 REASONABLY COULD BE CONSTRUED AS
MEANING THAT THE CONTEMPLATED CONTRACTS COULD NOT BE ENTERED INTO EXCEPT
AS SAVINGS WERE EFFECTED, WE AGREE WITH YOUR VIEW THAT THE CONFEREES
INTENDED THAT THE SECRETARY HAVE NO DISCRETION TO WITHHOLD FUNDS FOR
APPROVED PROJECTS PENDING PROOF OF ACTUAL SAVINGS.
AS INDICATED ABOVE THE COMMITTEE OF CONFERENCE ADDED TO SECTION 610
AUTHORITY FOR THE SECRETARY IN HIS DISCRETION, TO USE AN ADDITIONAL
$10,000,000 FOR PROGRAM PURPOSES, AND, RELATIVE TO SUCH PROVISION,
STATED IN ITS REPORT (AS QUOTED ABOVE) THAT - "IT IS THE CONFEREES
INTENT THAT THE SECRETARY BE GIVEN DISCRETION TO USE AN ADDITIONAL
$10,000,000 ANNUALLY *** FOR THE SAME PURPOSES."
IN ADDITION TO THAT PART OF THE CONFERENCE REPORT RELIED ON BY YOU IT
SEEMS CLEAR FROM THIS LAST STATEMENT THAT THE $10,000,000 THERE INVOLVED
WAS INTENDED AS A SUM IN ADDITION TO THE INITIAL $10,000,000 AND IT
SEEMS TO IMPLY THAT NO PART THEREOF WOULD BE USED UNTIL THE INITIAL
$10,000,000 HAD BEEN OBLIGATED. IT ALSO SEEMS CLEAR THAT THE CONFEREES
INTENDED THAT THE INITIAL $10,000,000 BE SPENT FOR THESE PROGRAMS, THE
AMOUNT OF THE SAVINGS NOT BEING AN ISSUE DURING ANY PART OF THE
CONGRESSIONAL CONSIDERATION.
IN VIEW OF THE FOREGOING, AND SINCE THE CONGRESS SUBSEQUENTLY ADOPTED
THE LEGISLATION RECOMMENDED BY THE CONFEREES AND NO QUESTION APPARENTLY
WAS RAISED REGARDING THE PURPOSE OF SECTION 610 AS DESCRIBED IN THE
CONFERENCE REPORT, WE SEE NO OBJECTION TO YOUR ENTERING INTO AGREEMENTS
AUTHORIZED BY SECTION 610 EVEN THOUGH THERE MAY BE NO PROOF THAT SAVINGS
HAVE BEEN EFFECTED.
B-171975, APR 30, 1971
MILITARY EMPLOYEE - TRANSFERS - TEMPORARY QUARTERS ALLOWANCE
DENYING CLAIM OF MEMBER OF THE ARMED FORCES FOR TEMPORARY LODGING
ALLOWANCE BEYOND THE 60-DAY LIMIT ALLOWED FOLLOWING AN ASSIGNMENT AND
THE 10-DAY LIMIT ALLOWED PRECEDING DEPARTURE, INCIDENT TO MEMBER'S
CHANGE OF STATION FROM FORT DIX, N.J., TO ECUADOR AND THEN TO FORT
EUSTIS, VA.
UPON MEMBER'S INITIAL ASSIGNMENT TO ECUADOR, WHILE DRIVING A
GOVERNMENT AUTOMOBILE, HE STRUCK AND KILLED A PEDESTRIAN. IN THE BEST
INTERESTS OF THE U.S., HIS TRANSFER FROM ECUADOR WAS ARRANGED BUT WAS
DELAYED BY THE ECUADORAN GOVERNMENT ON ACCOUNT OF DIFFICULTIES
SURROUNDING THE ACCIDENT.
THE REGULATIONS IN EFFECT AT THE TIME OF MEMBER'S DUTY IN ECUADOR
MADE NO PROVISION FOR AUTHORIZING LODGING ALLOWANCES BEYOND THE MAXIMUM
REGARDLESS OF CONDITIONS THAT ARE BEYOND THE CONTROL OF THE MEMBER.
TO SFC ANTONIO M. SOLA-ORTIZ:
IN A LETTER OF FEBRUARY 5, 1971, YOU REQUESTED A REVIEW OF THE
SETTLEMENT OF SEPTEMBER 1, 1970, BY OUR CLAIMS DIVISION WHICH DISALLOWED
YOUR CLAIM FOR ADDITIONAL TEMPORARY LODGING ALLOWANCE FOR A FOUR-MONTH
PERIOD IN 1963 WHEN YOU WERE STATIONED IN QUITO, ECUADOR.
IT APPEARS THAT IN JUNE 1962, YOU WERE ORDERED ON TEMPORARY DUTY FROM
FORT DIX, NEW JERSEY, TO ECUADOR AND WHILE THERE YOU WERE ASSIGNED ON A
PERMANENT CHANGE OF STATION TO THE U.S. ARMY MISSION IN ECUADOR ON
OCTOBER 12, 1962. IN APRIL 1963, YOUR WIFE AND SON TRAVELED FROM FORT
DIX, NEW JERSEY, TO JOIN YOU. WHEN THEY ARRIVED ON APRIL 19, 1963, YOU
FOUND TEMPORARY ACCOMMODATIONS IN A HOTEL WHERE YOU RESIDED WHILE
AWAITING THE ARRIVAL OF HOUSEHOLD GOODS.
MEANWHILE, ON DECEMBER 20, 1962, WHILE DRIVING A GOVERNMENT
AUTOMOBILE IN QUITO, YOU STRUCK A PEDESTRIAN WHO WAS AN ECUADORAN
NATIONAL. ALTHOUGH THE PEDESTRIAN DIED JUNE 21, 1963, YOU ASSERT THAT
YOU WERE CLEARED OF ALL LIABILITY FOR THE DEATH BY BOTH THE ECUADORAN
GOVERNMENT AND THE UNITED STATES ARMY. HOWEVER, THE UNITED STATES
AMBASSADOR DECIDED IN MAY 1963 THAT IT WOULD BE IN THE BEST INTEREST OF
THE UNITED STATES TO TRANSFER YOU FROM ECUADOR.
YOU STATE THAT ON MAY 28 YOU RECEIVED A VERBAL ORDER FROM YOUR
COMMANDING OFFICER NOT TO MOVE INTO PERMANENT HOUSING UNDER YOUR
ORIGINAL ORDERS. AN ORDER FOR YOUR TRANSFER TO FORT EUSTIS, VIRGINIA,
WAS ISSUED JUNE 4, 1963, BUT APPARENTLY THE DEPARTURE WAS DELAYED BY THE
ECUADORAN GOVERNMENT ON ACCOUNT OF DIFFICULTIES SURROUNDING THE TRAFFIC
ACCIDENT. YOU AND YOUR FAMILY CONTINUED TO RESIDE IN TEMPORARY LODGING
IN QUITO UNTIL YOU WERE FINALLY ALLOWED TO LEAVE ECUADOR ON AUGUST 13,
1963. YOU HAVE BEEN PAID TEMPORARY LODGING ALLOWANCE FOR THE 60-DAY
PERIOD FOLLOWING YOUR ASSIGNMENT TO ECUADOR AND FOR THE 10-DAY PERIOD
PRECEDING YOUR DEPARTURE.
YOU CLAIM THAT YOU SHOULD RECEIVE PAYMENT OF TEMPORARY LODGING
ALLOWANCE ON ACCOUNT OF THE HOTEL EXPENSE INCURRED DURING THE FOUR
MONTHS FROM THE ARRIVAL OF YOUR DEPENDENTS IN ECUADOR ON APRIL 19, 1963,
UNTIL YOU WERE ALLOWED TO LEAVE THE COUNTRY ON AUGUST 13, 1963. THE
GROUNDS FOR YOUR CLAIM ARE SUPPORTED BY A LETTER OF JUNE 28, 1963, FROM
YOUR FORMER MILITARY SUPERIOR, THE ACTING CHIEF OF THE MISSION IN QUITO.
SECTION 405 OF TITLE 37, UNITED STATES CODE, PROVIDES THAT THE
SECRETARIES CONCERNED MAY AUTHORIZE THE PAYMENT OF A PER DIEM,
CONSIDERING ALL ELEMENTS OF THE COST OF LIVING TO MEMBERS OF THE
UNIFORMED SERVICES UNDER THEIR JURISDICTION AND THEIR DEPENDENTS,
INCLUDING THE COST OF QUARTERS, SUBSISTENCE, AND OTHER NECESSARY
INCIDENTAL EXPENSES, TO SUCH A MEMBER WHO IS ON DUTY OUTSIDE OF THE
UNITED STATES OR IN HAWAII OR ALASKA, WHETHER OR NOT HE IS IN A TRAVEL
STATUS.
DURING THE PERIOD THAT YOU WERE STATIONED IN ECUADOR, REGULATIONS
GOVERNING THE PAYMENT OF TEMPORARY LODGING ALLOWANCES WERE CONTAINED IN
PARAGRAPH M4303 OF THE JOINT TRAVEL REGULATIONS, ISSUED PURSUANT TO THE
ABOVE AUTHORITY. PARAGRAPH 4303-1 PROVIDED THAT TEMPORARY LODGING
ALLOWANCES ARE AUTHORIZED FOR THE PURPOSE OF PARTIALLY REIMBURSING A
MEMBER FOR THE MORE THAN NORMAL EXPENSES INCURRED AT HOTELS OR
HOTEL-LIKE ACCOMMODATIONS AND PUBLIC RESTAURANTS (1) UPON INITIAL
ARRIVAL (REPORTING) AT A PERMANENT DUTY STATION OUTSIDE THE UNITED
STATES AND PENDING ASSIGNMENT OF GOVERNMENT QUARTERS OR PENDING
COMPLETION OF ARRANGEMENTS FOR OTHER PERMANENT LIVING ACCOMMODATIONS,
AND (2) IMMEDIATELY PRECEDING DEPARTURE ON A PERMANENT CHANGE OF STATION
FROM A PERMANENT STATION OUTSIDE THE UNITED STATES AND AFTER TERMINATION
OF ASSIGNMENT TO GOVERNMENT QUARTERS OR AFTER SURRENDER OF OTHER
PERMANENT ACCOMMODATIONS.
PARAGRAPH M4303-2(B) SPECIFICALLY PROVIDED THAT THE PERIOD OF
ENTITLEMENT, UPON INITIAL ASSIGNMENT TO A PERMANENT DUTY STATION OUTSIDE
THE UNITED STATES, WOULD NOT EXCEED 60 DAYS. PARAGRAPH M4303-2(C)
PROVIDED THAT THE PERIOD OF ENTITLEMENT UPON DEPARTURE WOULD BE THE LAST
10 DAYS PRECEDING THE DEPARTURE OF THE MEMBER FROM HIS STATION IN
COMPLIANCE WITH HIS ORDERS, EXCEPT THAT IF ONE OR MORE OF HIS DEPENDENTS
REMAINED AFTER HIS DEPARTURE, THE PERIOD WOULD BE THE LAST 10 DAYS
PRECEDING THE DEPARTURE OF THE LAST DEPENDENT OR THE EFFECTIVE DATE OF
THE PERMANENT CHANGE-OF-STATION ORDERS, WHICHEVER WAS EARLIER.
THE REGULATIONS IN EFFECT AT THE TIME OF YOUR DUTY IN ECUADOR MADE NO
PROVISION FOR AUTHORIZING OR APPROVING TEMPORARY LODGING ALLOWANCE
BEYOND THE 60-DAY MAXIMUM UPON ARRIVAL AND THE 10-DAY MAXIMUM UPON
DEPARTURE REGARDLESS OF ANY CONDITIONS WHICH WERE BEYOND THE CONTROL OF
THE MEMBER. THEREFORE, SINCE YOU HAVE BEEN PAID FOR THE MAXIMUM
PERIODS, NO FURTHER PAYMENT IS AUTHORIZED.
IT WILL BE NOTED FROM THE ENCLOSED COPIES OF DECISIONS, B-169449, MAY
14, 1970, AND B-161141, JUNE 14, 1967, THAT CERTAIN AMENDMENTS HAVE BEEN
ISSUED TO PARAGRAPH M4303 OF THE REGULATIONS COMMENCING WITH CHANGE 154
EFFECTIVE AUGUST 25, 1965, WHICH PERMIT AN EXTENSION OF THE PERIODS OF
ENTITLEMENT IN CERTAIN CIRCUMSTANCES BEYOND THE CONTROL OF THE MEMBER
WHICH REQUIRE THE UTILIZATION OF HOTEL ACCOMMODATIONS. THESE AMENDMENTS
ARE NOT RETROACTIVELY EFFECTIVE PRIOR TO THE DATE THEY WERE PROMULGATED,
HOWEVER, AND PROVIDE NO BASIS FOR EXTENDING THE PERIOD OF ENTITLEMENT IN
YOUR CASE.
ACCORDINGLY, THE SETTLEMENT OF SEPTEMBER 1, 1970, WHICH DISALLOWED
YOUR CLAIM IS SUSTAINED.
B-145522, APR 29, 1971
MUSTERING OUT PAY
DENYING CLAIM OF THE SISTER OF THE LATE AGATON L. ROBILLO FOR
MUSTERING-OUT PAY BELIEVED DUE INCIDENT TO THE BROTHER'S SERVICE IN THE
PHILIPPINE SCOUTS DURING WORLD WAR II ON BASIS THAT A CLAIM NOT ASSERTED
WITHIN 10 YEARS FROM THE DATE IT ACCRUES IS BARRED BY 31 U.S.C. 71A.
TO MISS ANA L. ROBILLO:
REFERENCE IS MADE TO YOUR LETTER DATED MARCH 11, 1971, CONCERNING
YOUR CLAIM FOR AMOUNTS BELIEVED BY YOU TO BE DUE YOUR LATE BROTHER,
AGATON L. ROBILLO, INCIDENT TO HIS SERVICE IN THE PHILIPPINE SCOUTS.
IN PRIOR LETTERS TO YOU CONCERNING THIS MATTER, WE HAVE ADVISED YOU
THAT WE ARE WITHOUT AUTHORITY TO CONSIDER YOUR CLAIM SINCE THE ACT OF
OCTOBER 9, 1940, CH. 788, 54 STAT. 1061, 31 U.S.C. 71A, BARS
CONSIDERATION OF ALL CLAIMS NOT RECEIVED IN THE GENERAL ACCOUNTING
OFFICE WITHIN 10 FULL YEARS AFTER THE DATE OF ACCRUAL. YOU WERE ALSO
ADVISED THAT SUCH LIMITATION PERIOD HAD EXPIRED SEVERAL YEARS BEFORE
YOUR CLAIM WAS FIRST RECEIVED IN OUR OFFICE.
YOU NOW STATE THAT YOU MADE A TIMELY CLAIM AND YOU SUBMIT AS PROOF
THEREOF A COPY OF A LETTER DATED JANUARY 12, 1950, RELATING TO THIS
MATTER. YOU ALSO REFER TO CERTAIN BENEFITS WHICH MAY BE DUE BY VIRTUE
OF THE PROVISIONS OF TITLE 38, U.S. CODE.
AS TO THE MATTER OF BENEFITS WHICH MAY BE AVAILABLE TO YOU UNDER THE
PROVISIONS OF TITLE 38, U.S. CODE, BY VIRTUE OF YOUR BROTHER'S DEATH,
YOU HAVE BEEN ADVISED ON SEVERAL OCCASIONS THAT SUCH BENEFITS, INCLUDING
INSURANCE, ARE MATTERS WITHIN THE EXCLUSIVE JURISDICTION OF THE VETERANS
ADMINISTRATION. ANY INQUIRY THAT YOU WISH TO MAKE IN THAT REGARD SHOULD
BE SUBMITTED TO THE NEAREST UNITED STATES VETERANS ADMINISTRATION OFFICE
IN THE PHILIPPINES.
WITH RESPECT TO THE LETTER DATED JANUARY 12, 1950, WHICH YOU INDICATE
WAS MAILED TO OUR OFFICE, YOU ARE ADVISED THAT SINCE THE COPY YOU
SUBMITTED SHOWS THAT THE LETTER WAS ADDRESSED TO THIS OFFICE "THROUGH"
THE U.S. ARMY FINANCE CENTER, INDIANAPOLIS, INDIANA, IT APPEARS PROBABLE
THAT IF IT ACTUALLY WAS MAILED, IT WAS RECEIVED IN THE ARMY FINANCE
CENTER, NOT IN OUR OFFICE. WE HAVE NO RECORD OF HAVING RECEIVED THAT
LETTER OR ANY OTHER CORRESPONDENCE WITH RESPECT TO A CLAIM FOR ITEMS OF
PAY AND ALLOWANCES DUE YOUR LATE BROTHER PRIOR TO JUNE 6, 1960, NEARLY
18 YEARS AFTER HIS DEATH.
IN THE CIRCUMSTANCES, THE SUBMITTED COPY OF THE LETTER OF JANUARY 12
1950, FURNISHES NO BASIS FOR THE PAYMENT OF YOUR CLAIM.
UNLESS YOU HAVE SOME NEW EVIDENCE RELATING TO YOUR CLAIM OR OTHER
MATTER NOT PREVIOUSLY CONSIDERED BY THIS OFFICE, IT APPEARS THAT FURTHER
CORRESPONDENCE WITH RESPECT THERETO WILL SERVE NO USEFUL PURPOSE.
THEREFORE, ANY SUCH CORRESPONDENCE RECEIVED FROM YOU IN THE FUTURE WILL
BE FILED WITHOUT REPLY.
B-171586(1), APR 29, 1971
BID PROTEST - RESPONSIBILITY - GEOGRAPHIC AREA - REOPENING OF
NEGOTIATIONS
DENYING PROTEST OF RSC INDUSTRIES, INC., AGAINST THE PROPOSED AWARD
OF A CONTRACT TO JAKUS ASSOCIATES UNDER AN RFP ISSUED BY THE NAVY SUPPLY
SYSTEMS COMMAND, WASHINGTON NAVY YARD FOR AN INDEFINITE NUMBER OF
MAN-HOURS FOR TECHNICAL SERVICES IN SUPPORT OF PROJECT SURPASS.
THE REQUIREMENT THAT A CONTRACTOR BE LOCATED IN A GIVEN AREA IS
MATTER OF RESPONSIBILITY AND WHERE BIDDERS LOCATED OUTSIDE THE
PRESCRIBED GEOGRAPHICAL AREA PROPOSE EITHER TO SET UP FACILITIES IN OR
TO UTILIZE THE PLANT OF ANOTHER COMPANY LOCATED WITHIN THE PRESCRIBED
AREA, BIDS SHOULD NOT BE REJECTED IF OTHERWISE ACCEPTABLE.
REOPENING OF NEGOTIATIONS WITHOUT ANY STATED REASON IS NOT AN AUCTION
TECHNIQUE BUT IS REQUIRED UNDER APPROPRIATE CIRCUMSTANCES BY ASPR
3-805.1(A).
TO RSC INDUSTRIES, INC.:
WE REFER TO YOUR LETTER DATED FEBRUARY 22, 1971, AND PRIOR
CORRESPONDENCE, PROTESTING AGAINST THE PROPOSED AWARD OF A CONTRACT TO
JAKUS ASSOCIATES, SAN DIEGO, CALIFORNIA, UNDER REQUEST FOR PROPOSALS
(RFP) NO. N00600-70-R-5344, ISSUED BY THE NAVAL SUPPLY SYSTEMS COMMAND,
U.S. NAVY PURCHASING OFFICE (NPO), WASHINGTON NAVY YARD, FOR AN
INDEFINITE NUMBER OF MAN-HOURS FOR TECHNICAL SERVICES IN SUPPORT OF
PROJECT SURPASS.
THE PROTEST IS DENIED FOR REASONS HEREINAFTER STATED.
SINCE NO AWARD HAS BEEN MADE OF THIS NEGOTIATED PROCUREMENT, WE MUST
RESTRICT OUR RECITATION OF THE FACTS. PARAGRAPH 3-507.2 OF THE ARMED
SERVICES PROCUREMENT REGULATION (ASPR); B-169633, AUGUST 20, 1970, 50
COMP. GEN. ___.
THE PROPOSALS RECEIVED UNDER THE RFP WERE SUBMITTED FOR TECHNICAL
EVALUATION TO THE NAVAL SHIP RESEARCH AND DEVELOPMENT CENTER (NSRDC) ON
APRIL 13, 1970. NSRDC DETERMINED THAT THE PROPOSALS OF CERTAIN FIRMS
WERE NOT WITHIN THE COMPETITIVE RANGE ON A TECHNICAL BASIS. ON JUNE 2,
1970, THOSE FIRMS WERE NOTIFIED THEIR PROPOSALS WERE UNACCEPTABLE. FROM
JULY 16 THROUGH JULY 24, 1970, NEGOTIATIONS WERE CONDUCTED WITH THE
FIRMS WITHIN THE COMPETITIVE RANGE RESULTING IN THE SUBMISSION OF
REVISED PROPOSALS ON JULY 24, 1970.
ON SEPTEMBER 8, 1970, IN ACCORDANCE WITH ASPR 1-703(B)(1), NOTICE WAS
SENT TO ALL OFFERORS ADVISING THEM OF THE THEN CONTEMPLATED AWARD TO
RSC. HOWEVER, THE CONTRACTING OFFICER REPORTS:
"AS THE RESULT, HOWEVER, OF A FINAL REVIEW IN THIS OFFICE OF THE
RECOMMENDED AWARD TO RSC, IT WAS DETERMINED THAT THE ACTION REJECTING
THE OFFERS OF (NAMES OF FIRMS OMITTED) WITHOUT ANY DISCUSSIONS WAS NOT
CONSISTENT WITH THE INTENT OF ASPR 3-805. A DECISION WAS THEREFORE MADE
TO OPEN NEGOTIATIONS WITH ALL FIRMS THAT HAD SUBMITTED PROPOSALS SO THAT
ALL FIRMS MIGHT HAVE AN OPPORTUNITY TO REVISE THEIR PROPOSALS."
NEGOTIATIONS WERE REOPENED BY LETTER DATED SEPTEMBER 24, 1970.
NEGOTIATIONS WERE REOPENED AGAIN ON NOVEMBER 24 AND 30, 1970, IN ORDER
TO CLARIFY SOME PROPOSALS. BY LETTER DATED DECEMBER 17, 1970, ALL
OFFERORS WERE NOTIFIED THAT JAKUS WAS THE SUCCESSFUL OFFEROR.
THE FIRST BASIS OF THE PROTEST IS THAT "IN THE EVENT THAT JAKUS
ASSOCIATES HAS PROPOSED TO OPEN A FACILITY, OR TO USE AN EXISTING
AFFILIATE OR SUBSIDIARY FACILITY IN WASHINGTON, D.C., RSC SUBMITS THAT
CRITERIA A(3) AND B (OF THE RFP) WOULD *** BE VIOLATED." THE CITED
CRITERIA, INSOFAR AS PERTINENT, WERE:
"A. EVALUATION WILL BE BASED ON THE FOLLOWING CRITERIA:
"(3) LOCATION WITHIN 50 MILES OF WASHINGTON, D.C.
"B. *** OFFERS THAT DO NOT SHOW AN OPERATING FACILITY WITHIN 50
MILES OF WASHINGTON, D.C. WILL NOT BE CONSIDERED."
FURTHER, THE RFP CONTAINED A CAVEAT AS FOLLOWS:
"WARNING - LIMITATION OF GEOGRAPHICAL AREA
"ANY CONTRACT AWARDED AS A RESULT OF THIS SOLICITATION SHALL BE WITH
A FIRM THAT HAS OPERATING FACILITIES LOCATED WITHIN A FIFTY (50) MILE
RADIUS OF WASHINGTON, D.C."
OUR OFFICE HAS HELD, WITH REFERENCE TO FORMALLY ADVERTISED
PROCUREMENTS, THAT THE REQUIREMENT THAT A CONTRACTOR BE LOCATED IN A
GIVEN AREA IS A MATTER OF RESPONSIBILITY AND THAT WHERE BIDDERS LOCATED
OUTSIDE THE PRESCRIBED GEOGRAPHICAL AREA PROPOSE EITHER TO SET UP
FACILITIES IN OR TO UTILIZE THE PLANT OF ANOTHER COMPANY LOCATED WITHIN
THE PRESCRIBED AREA, THE BIDS SHOULD NOT BE REJECTED IF THE BIDDERS ARE
OTHERWISE ACCEPTABLE. B-163039, JANUARY 25, 1968, AND CASES CITED
THEREIN. THERE IS NO REASON WHY SUCH HOLDING SHOULD NOT APPLY TO
NEGOTIATED PROCUREMENTS AS WELL. IN THAT CONNECTION, ASPR 1-903.2
REQUIRES THAT A PROSPECTIVE CONTRACTOR:
"(I) HAVE THE NECESSARY ORGANIZATION, EXPERIENCE, OPERATIONAL
CONTROLS AND TECHNICAL SKILLS, OR THE ABILITY TO OBTAIN THEM (INCLUDING
WHERE APPROPRIATE, SUCH ELEMENTS AS PRODUCTION CONTROL PROCEDURES,
PROPERTY CONTROL SYSTEM AND QUALITY ASSURANCE MEASURES APPLICABLE TO
MATERIALS PRODUCED OR SERVICES PERFORMED BY THE PROSPECTIVE CONTRACTOR
AND SUBCONTRACTORS (SEE 1-903.4)); AND
"(II) HAVE THE NECESSARY PRODUCTION, CONSTRUCTION, AND TECHNICAL
EQUIPMENT AND FACILITIES, OR THE ABILITY TO OBTAIN THEM. WHERE A
PROSPECTIVE CONTRACTOR PROPOSES TO USE THE FACILITIES OR EQUIPMENT OF
ANOTHER CONCERN, NOT A SUBCONTRACTOR, OR OF HIS AFFILIATE (SEE
2-201(A)B(II) AND (B)(XVII)), ALL EXISTING BUSINESS ARRANGEMENTS, FIRM
OR CONTINGENT, FOR THE USE OF SUCH FACILITIES OR EQUIPMENT SHALL BE
CONSIDERED IN DETERMINING THE ABILITY OF THE PROSPECTIVE CONTRACTOR TO
PERFORM THE CONTRACT; SEE ALSO 1-904.2."
ASPR 1-903.4 CONSIDERS THAT ACCEPTABLE EVIDENCE OF A PROSPECTIVE
CONTRACTOR'S "ABILITY TO OBTAIN" THE NECESSARY FACILITIES AND PERSONNEL
REQUIRED BY ASPR 1-903.2 "SHALL NORMALLY BE A COMMITMENT OR EXPLICIT
ARRANGEMENT, WHICH WILL BE IN EXISTENCE AT THE TIME THE CONTRACT IS TO
BE AWARDED, FOR THE RENTAL, PURCHASE OR OTHER ACQUISITION OF SUCH
RESOURCES, EQUIPMENT, FACILITIES, OR PERSONNEL."
MOREOVER, THE MATTER OF RESPONSIBILITY IS RESOLVED AS OF THE TIME
THAT PERFORMANCE IS SCHEDULED TO BEGIN, NOT THE DATE SET FOR THE RECEIPT
OF PROPOSALS. SEE 47 COMP. GEN. 373, 376 (1968) AND B-162888, JANUARY
4, 1968.
FURTHER, THE DEFENSE CONTRACT ADMINISTRATION SERVICES DISTRICT HAS
CONDUCTED A PREAWARD SURVEY ON JAKUS AND IS SATISFIED THAT THE COMPANY'S
PLANS FOR COMMENCING WORK UPON RECEIPT OF AWARD ARE SATISFACTORY.
THE SECOND BASIS OF THE PROTEST IS THAT THE REOPENING OF NEGOTIATIONS
ON TWO OCCASIONS WITHOUT ANY STATED REASON OR JUSTIFICATION CONSTITUTED
AN AUCTION TECHNIQUE AND WAS THEREFORE IMPROPER. WE DO NOT AGREE. THE
REOPENING OF NEGOTIATIONS WAS REQUIRED BY THE COMPETITIVE NEGOTIATION
PROVISIONS OF 10 U.S.C. 2304(G) AS IMPLEMENTED BY ASPR 3-805.1(A).
FURTHER, UNLESS A PROPOSAL IS DETERMINED TO BE SO TECHNICALLY INFERIOR
AS TO PRECLUDE ANY POSSIBILITY OF MEANINGFUL NEGOTIATION, THERE IS AN
OBLIGATION TO CONDUCT DISCUSSIONS WITH THE OFFEROR. SEE 45 COMP. GEN.
417, 427 (1966); AND 47 ID. 29, 53 (1967). ALSO, WE HAVE RECOGNIZED
THAT THE DETERMINATION OF COMPETITIVE RANGE WITH REGARD TO TECHNICAL
CONSIDERATIONS IS ONE WHICH INITIALLY IS FOR THE CONTRACTING OFFICER TO
EXERCISE IN HIS DISCRETION. SEE 48 COMP. GEN. 314, 317 (1968).
ALTHOUGH, INITIALLY, SEVERAL OFFERORS WERE DETERMINED TO BE OUTSIDE
THE COMPETITIVE RANGE ON A TECHNICAL BASIS, FURTHER REVIEW BY NPO
DISCLOSED THAT THESE OFFERORS WERE WITHIN THE COMPETITIVE RANGE SINCE
THEIR PROPOSALS COULD BE MADE ACCEPTABLE, IF EFFECTIVELY REVISED THROUGH
MEANINGFUL NEGOTIATIONS. UNDER THESE CIRCUMSTANCES, THE REOPENING OF
DISCUSSIONS FOR THE PURPOSE OF CORRECTING NEGOTIABLE DEFICIENCIES WAS
APPROPRIATE. SEE B-169633, SUPRA.
THE PROVISIONS OF ASPR 3-507.2 AND 3-805.1(B) PROHIBIT THE DISCLOSURE
TO OFFERORS, AFTER THE RECEIPT OF PROPOSALS PRIOR TO AWARD, OF ANY
INFORMATION CONTAINED IN ANY OTHER PROPOSAL OR INFORMATION REGARDING THE
NUMBER OR IDENTITIES OF OFFERORS. KEEPING THIS IN MIND, WHERE, AS HERE,
NEGOTIATIONS ARE REOPENED FOR THE PURPOSE OF CONDUCTING DISCUSSIONS WITH
OFFERORS IMPROPERLY EXCLUDED FROM THE COMPETITIVE RANGE, NPO COULD NOT
HAVE ADVISED RSC OF THE PARTICULAR BASES FOR REOPENING NEGOTIATIONS WITH
AN INDIVIDUAL OFFEROR. IN ADDITION, NO PROHIBITED AUCTION TECHNIQUES
RESULTED FROM THE REOPENING OF NEGOTIATIONS, SINCE THE BASIS THEREFOR
WAS IN COMPLIANCE WITH THE ABOVE-CITED LAW AND REGULATIONS. YOUR
STATEMENT THAT RSC WAS ADVISED BY THE NPO CONTRACT NEGOTIATOR THAT "RSC
WAS NO LONGER LOW BIDDER," IS DENIED BY THE NEGOTIATOR, AND THERE IS AN
ABSENCE OF EVIDENCE OF RECORD TO OVERCOME THE CORRECTNESS OF THE
NEGOTIATOR'S DENIAL.
YOUR FINAL BASIS FOR PROTEST IS THAT NPO FAILED TO COMPLY WITH
PARAGRAPH "C" OF THE EVALUATION CRITERIA BY CONTEMPLATING AN AWARD TO A
TECHNICALLY INFERIOR LOW-PRICED OFFEROR. PARAGRAPH "C" STATED:
"AWARD OF THE CONTRACT RESULTING FROM THIS SOLICITATION WILL BE
INFLUENCED BY THE PROPOSAL WHICH PROMISES THE GREATEST VALUE TO THE
GOVERNMENT IN TERMS OF PERFORMANCE RATHER THAN BY THE PROPOSAL OFFERING
THE LOWEST PRICE. THE GOVERNMENT RESERVES THE RIGHT TO JUDGE WHICH
PROPOSALS SHOW THE REQUIRED COMPETENCE IN THE FUNCTIONAL AREAS LISTED
AND WHICH PROPOSAL OFFERS THE GREATEST VALUE TO THE GOVERNMENT." WE
INTERPRET THIS PROVISION AS ALLOWING FOR THE CONSIDERATION OF BOTH PRICE
AND TECHNICAL ASPECTS OF THE PROPOSALS.
SUBSEQUENT TO THE CLOSE OF NEGOTIATIONS, ALL PROPOSALS WERE EVALUATED
ON THE BASIS OF THEIR TECHNICAL ACCEPTABILITY. IN THAT CONNECTION, WE
HAVE BEEN ADVISED:
"THE ESSENTIAL INGREDIENTS FOR PERFORMANCE ARE QUALIFICATIONS OF
PERSONNEL TO PERFORM THE WORK AND THE CONTRACTOR'S EXPERIENCE.
AN ANALYSIS OF REVISED PROPOSALS INDICATED THAT THE OFFERORS WERE
COMPETENT TO PROVIDE THE SERVICES REQUIRED. THE ANALYSIS DID NOT
DISCLOSE ANY INFORMATION WHICH WOULD INDICATE INCREASED PERFORMANCE OR
GREATER VALUE TO THE GOVERNMENT SHOULD AN AWARD BE MADE TO ANY OTHER
OFFEROR *** THAN JAKUS ASSOCIATES." IN CIRCUMSTANCES SUCH AS THESE, IF A
TECHNICALLY ACCEPTABLE OFFEROR, SUCH AS JAKUS, HAS SUBMITTED A LOWER
PRICE (THIS CANNOT BE DISCLOSED BECAUSE OF THE PREAWARD POSTURE OF THE
PROCUREMENT), IT IS OUR VIEW THAT A CONTEMPLATED AWARD TO THAT OFFEROR
WOULD NOT BE OBJECTIONABLE. SEE B-169148, OCTOBER 6, 1970, 50 COMP.
GEN. ___ AND B-170038, MARCH 29, 1971, 50 COMP. GEN. ___.
WITH REGARD TO YOUR ALTERNATIVE CONTENTION THAT YOU SHOULD HAVE BEEN
ADVISED THAT YOUR PRICE WAS DEFICIENT AND PROVIDED AN OPPORTUNITY TO
REVISE IT, ASPR 3-805.1(B) PROVIDES:
"WHENEVER NEGOTIATIONS ARE CONDUCTED WITH MORE THAN ONE OFFEROR,
AUCTION TECHNIQUES ARE STRICTLY PROHIBITED; AN EXAMPLE WOULD BE
INDICATING TO AN OFFEROR A PRICE WHICH MUST BE MET TO OBTAIN FURTHER
CONSIDERATION, OR INFORMING HIM THAT HIS PRICE IS NOT LOW IN RELATION TO
THAT OF ANOTHER OFFEROR. ON THE OTHER HAND, IT IS PERMISSIBLE TO INFORM
AN OFFEROR THAT HIS PRICE IS CONSIDERED BY THE GOVERNMENT TO BE TOO
HIGH. *** "
IN VIEW OF THE FOREGOING, AN AWARD TO JAKUS APPEARS TO BE JUSTIFIED.
B-171586(2), APR 29, 1971
BID PROTEST - RESPONSIBILITY - GEORGRAPHIC AREA
DENYING PROTEST OF COLUMBIA RESEARCH CORPORATION AGAINST THE PROPOSED
AWARD OF A CONTRACT TO JAKUS ASSOCIATED UNDER AN RFP ISSUED BY THE NAVY
SUPPLY SYSTEMS COMMAND, WASHINGTON NAVY YARD FOR AN INDEFINITE NUMBER OF
MAN-HOURS FOR TECHNICAL SERVICES IN SUPPORT OF PROJECT SURPASS.
THE REQUIREMENT THAT A CONTRACTOR BE LOCATED IN A GIVEN AREA IS
MATTER OF RESPONSIBILITY AND WHERE BIDDERS LOCATED OUTSIDE THE
PRESCRIBED GEOGRAPHICAL AREA PROPOSE EITHER TO SET UP FACILITIES IN, OR
TO UTILIZE THE PLANT OF ANOTHER COMPANY LOCATED WITHIN THE PRESCRIBED
AREA, BIDS SHOULD NOT BE REJECTED IF OTHERWISE ACCEPTABLE.
TO COLUMBIA RESEARCH CORPORATION:
REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 22, 1971, AND PRIOR
CORRESPONDENCE, PROTESTING AGAINST THE PROPOSED AWARD OF A CONTRACT TO
JAKUS ASSOCIATES, SAN DIEGO, CALIFORNIA, UNDER REQUEST FOR PROPOSALS
(RFP) NO. N00600-70-R-5344, ISSUED BY THE NAVAL SUPPLY SYSTEMS COMMAND,
U.S. NAVY PURCHASING OFFICE, WASHINGTON NAVY YARD, FOR AN INDEFINITE
NUMBER OF MAN-HOURS FOR TECHNICAL SERVICES IN SUPPORT OF PROJECT
SURPASS. THE PROTEST IS DENIED FOR THE REASONS HEREINAFTER STATED.
THE PROTEST IS "BASED UPON THE FACT THAT JAKUS ASSOCIATES IS A
NONRESPONSIVE OFFEROR, HAVING FAILED TO MEET THE GEOGRAPHICAL AREA
LIMITATION SPECIFIED IN THE SOLICITATION." IN THIS REGARD, THE RFP
CONTAINED A CAVEAT AS FOLLOWS:
"WARNING - LIMITATION OF GEOGRAPHICAL AREA
"ANY CONTRACT AWARDED AS A RESULT OF THIS SOLICITATION SHALL BE WITH
A FIRM THAT HAS OPERATING FACILITIES LOCATED WITHIN A FIFTY (50) MILE
RADIUS OF WASHINGTON, D.C." IN ADDITION, INSOFAR AS PERTINENT, THE RFP
STATED:
"A. EVALUATION WILL BE BASED ON THE FOLLOWING CRITERIA:
"(3) LOCATION WITHIN 50 MILES OF WASHINGTON, D.C.
"B. *** OFFERS THAT DO NOT SHOW AN OPERATING FACILITY WITHIN 50
MILES OF WASHINGTON, D.C. WILL NOT BE CONSIDERED."
YOU STATE THAT IT IS OBVIOUS THAT JAKUS HAS MADE NO SUBSTANTIAL
EFFORT TO ESTABLISH AN OPERATING FACILITY WITHIN THE GEOGRAPHICAL
PARAMETERS PRESCRIBED BY THE RFP, BUT HAD MERELY ARRANGED TO USE THE
WORKING SPACE OF ANOTHER FIRM." FURTHER, YOU STATE THAT IF SUCH AN
ARRANGEMENT WAS ACCEPTABLE, THE INTENDED RESTRICTIVE CHARACTER OF THE
GEOGRAPHICAL LIMITATION CLAUSE WOULD BE OF NO USEFUL EFFECT, IN THAT ANY
BIDDER COULD QUALIFY FOR THE PROCUREMENT BY STATING AN INTENTION TO
ESTABLISH AN OPERATING FACILITY WITHIN THE REQUIRED AREA. HOWEVER, YOU
RECOGNIZE THAT THE GEOGRAPHICAL LIMITATION CLAUSE IS A SPECIAL STANDARD
OF RESPONSIBILITY IN ACCORDANCE WITH THE PROVISIONS OF PARAGRAPH 1-903.3
OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). IN CONCLUSION, YOU
INQUIRE AS TO THE ARRANGEMENTS JAKUS HAD MADE WITH THE QUEST RESEARCH
CORPORATION.
OUR OFFICE HAS HELD, WITH REFERENCE TO FORMALLY ADVERTISED
PROCUREMENTS, THAT THE REQUIREMENT THAT A CONTRACTOR BE LOCATED IN A
GIVEN AREA IS A MATTER OF RESPONSIBILITY AND THAT WHERE BIDDERS LOCATED
OUTSIDE THE PRESCRIBED GEOGRAPHICAL AREA PROPOSE EITHER TO SET UP
FACILITIES IN OR TO UTILIZE THE PLANT OF ANOTHER COMPANY LOCATED WITHIN
THE PRESCRIBED AREA, THE BIDS SHOULD NOT BE REJECTED IF THE BIDDERS ARE
OTHERWISE ACCEPTABLE. B-163039, JANUARY 25, 1968, AND CASES CITED
THEREIN. THERE IS NO REASON WHY SUCH HOLDING SHOULD NOT APPLY TO
NEGOTIATED PROCUREMENTS AS WELL. IN THAT CONNECTION, ASPR 1-903.2
REQUIRES THAT A PROSPECTIVE CONTRACTOR:
"(I) HAVE THE NECESSARY ORGANIZATION, EXPERIENCE, OPERATIONAL
CONTROLS AND TECHNICAL SKILLS, OR THE ABILITY TO OBTAIN THEM (INCLUDING
WHERE APPROPRIATE, SUCH ELEMENTS AS PRODUCTION CONTROL PROCEDURES,
PROPERTY CONTROL SYSTEM AND QUALITY ASSURANCE MEASURES APPLICABLE TO
MATERIALS PRODUCED OR SERVICES PERFORMED BY THE PROSPECTIVE CONTRACTOR
AND SUBCONTRACTORS (SEE 1-903.4); AND
"(II) HAVE THE NECESSARY PRODUCTION, CONSTRUCTION, AND TECHNICAL
EQUIPMENT AND FACILITIES, OR THE ABILITY TO OBTAIN THEM. WHERE A
PROSPECTIVE CONTRACTOR PROPOSES TO USE THE FACILITIES OR EQUIPMENT OF
ANOTHER CONCERN, NOT A SUBCONTRACTOR, OR OF HIS AFFILIATE (SEE
2-201(A)B(II) AND (B)(XVII)), ALL EXISTING BUSINESS ARRANGEMENTS, FIRM
OR CONTINGENT, FOR THE USE OF SUCH FACILITIES OR EQUIPMENT SHALL BE
CONSIDERED IN DETERMINING THE ABILITY OF THE PROSPECTIVE CONTRACTOR TO
PERFORM THE CONTRACT; SEE ALSO 1-904.2."
ASPR 1-903.4 CONSIDERS THAT ACCEPTABLE EVIDENCE OF A PROSPECTIVE
CONTRACTOR'S "ABILITY TO OBTAIN" THE NECESSARY FACILITIES AND PERSONNEL
REQUIRED BY ASPR 1-903.2 "SHALL NORMALLY BE A COMMITMENT OR EXPLICIT
ARRANGEMENT, WHICH WILL BE IN EXISTENCE AT THE TIME THE CONTRACT IS TO
BE AWARDED, FOR THE RENTAL, PURCHASE OR OTHER ACQUISITION OF SUCH
RESOURCES, EQUIPMENT, FACILITIES, OR PERSONNEL."
MOREOVER, THE MATTER OF RESPONSIBILITY IS RESOLVED AS OF THE TIME
THAT PERFORMANCE IS SCHEDULED TO BEGIN, NOT THE DATE SET FOR RECEIPT OF
PROPOSALS. SEE 47 COMP. GEN. 373, 376 (1968) AND B-162888, JANUARY 4,
1968.
IT IS TRUE THAT JAKUS INTENDS TO UTILIZE THE FACILITIES OF QUEST
RESEARCH CORPORATION, MCLEAN, VIRGINIA, A FIRM WITHIN THE PRESCRIBED
GEOGRAPHICAL BOUNDARY. FURTHER, JAKUS HAS INDICATED THAT THE FIRM WILL
PERFORM THE CONTRACT WITH JAKUS TECHNICAL PERSONNEL AT NO COST TO THE
GOVERNMENT FOR TRAVEL BETWEEN THE WEST COAST AND WASHINGTON, D.C. ALSO,
THERE IS ON FILE AN AGREEMENT DATED SEPTEMBER 30, 1970, UNDER WHICH
QUEST AGREES TO PROVIDE JAKUS WITH OFFICE SPACE, TELEPHONE SERVICE,
TECHNICAL ASSISTANCE, CLERICAL SUPPORT, AND CLASSIFIED DOCUMENT STORAGE,
AS REQUIRED, FOR A PERIOD OF 18 MONTHS FROM THE DATE OF THE AGREEMENT OR
UNTIL CANCELED BY EITHER PARTY.
THE DEFENSE CONTRACT ADMINISTRATION SERVICES DISTRICT (DCASD) HAS
CONDUCTED A PREAWARD SURVEY THAT ANSWERS YOUR QUESTIONS AS TO JAKUS'
ARRANGEMENTS. DCASD HAS RECOMMENDED COMPLETE AWARD AND STATED:
"A. THE PERSONNEL LIST IS NOT THE MOST RECENT LIST FURNISHED BY
JAKUS UNDER THE PROPOSAL. MOST OF THE PERSONNEL IN THE LATEST LIST ARE
OR HAVE BEEN EMPLOYED BY JAKUS. THOSE NOT EMPLOYED HAVE GIVEN CONSENT
FOR USE OF THEIR RESUMES; HOWEVER THIS CONSENT IS NOT IN THE FORM OF AN
AFFIDAVIT. OUR EXAMINATION OF THE RFP AND THE ASPR DOES NOT REVEAL ANY
REQUIREMENT FOR AN AFFIDAVIT.
"B. JAKUS WOULD BEAR THE COST OF TRANSFERRING PERSONNEL AS NECESSARY
TO THE WASHINGTON AREA. CHARGES TO THE GOVERNMENT FOR SUCH EXPENSE
WOULD BE PRECLUDED BY THE TERMS OF THE CONTRACT, WHICH ESTABLISHES FIXED
PRICE HOURLY RATES FOR SPECIFIC TASKS AS IDENTIFIED IN WORK ORDERS. IT
IS UNDERSTOOD THAT THERE IS NO PROVISION IN PROPOSED CONTRACT FOR
RENEGOTIATION OF THE HOURLY RATES.
"C. CONTRACTOR'S LETTER 23 NOV 70 EXPLAINS HIS PLAN FOR COMMENCING
WORK UPON RECEIPT OF AWARD. THE PLAN IS RESPONSIVE TO RFP REQUIREMENTS
AND APPEARS FEASIBLE. DCASD RECORDS ON JAKUS INDICATE THAT CONTRACTS
ADMINISTERED HAVE BEEN PERFORMED TO SCHEDULE.
"D. ALTHOUGH JAKUS EMPLOYEES HAVE PERFORMED DUTIES IN WASHINGTON
FROM TIME TO TIME, THEY WERE USUALLY ATTACHED TO JAKUS' SAN DIEGO OFFICE
WITH NO PERMANENT WASHINGTON ASSIGNMENT.
"E. UNDER JAKUS' AGREEMENT WITH QUEST RESEARCH CORPORATION, QUEST
WOULD IN EFFECT BE THE LANDLORD, AND IN ADDITION WOULD FURNISH THE
OFFICE EQUIPMENT AND SERVICES AS INDICATED. THE ATTACHED AGREEMENT HAS
BEEN REAFFIRMED PER ATTACHED QUEST LETTER 15 MAR 71 AND JAKUS
ENDORSEMENT 17 MAR 71. IN OUR OPINION QUEST IS NOT AN AFFILIATE OF
JAKUS UNDER THE DEFINITION OF ASPR 1-701.1(C).
"F. JAKUS WOULD BE THE PRIME CONTRACTOR FOR PROPOSED PROCUREMENT.
ALTHOUGH THEY MAY ELECT TO SUBCONTRACT FOR VARIOUS SPECIFIC SERVICES,
THEY WOULD NOT SUBCONTRACT THE TASKS DESCRIBED IN THE WORK ORDERS TO ANY
OTHER COMPANY FOR TOTAL PERFORMANCE. IT IS BELIEVED THAT THIS PLAN IS
ACCEPTABLE WITHIN THE PROVISIONS OF THE CONTRACT, THE ONLY RESTRICTION
BEING THE GP REQUIREMENT TO OBTAIN THE PCO'S CONSENT ON PURCHASE ORDERS
OVER $25,000.00."
IN VIEW OF THE FOREGOING, AN AWARD TO JAKUS WOULD NOT APPEAR TO BE
IMPROPER.
B-171836, APR 29, 1971
CIVILIAN EMPLOYEE - TEMPORARY QUARTERS - PER DIEM
ALLOWING PAYMENT OF ROBERT D. ROGERS OF PER DIEM AT A RATE OF $11.80
INCIDENT TO HIS ATTENDANCE AT A COURSE OF INSTRUCTION AT FORT LEE,
VIRGINIA, PURSUANT TO TRAVEL ORDERS ISSUED BY THE DEFENSE GENERAL SUPPLY
CENTER (DGSC) AT RICHMOND, VA.
SINCE THE COMP. GEN. IS UNAWARE OF ANY PROVISIONS IN THE JTR WHICH
WOULD PERMIT THE CONSTRUCTION OF A RATE OF $5 FOR PER DIEM AS PRESCRIBED
IN DGSC REGULATION 5000.1 BASED ON THE USE OF GOVERNMENT QUARTERS, AS
WAS DONE IN THIS CASE, THE PROVISIONS OF JTR, VOLUME 2, C8101-2E,
PRESCRIBING A PER DIEM RATE OF $11.80 ARE FOR APPLICATION.
TO MR. M. E. SMITH:
WE REFER FURTHER TO YOUR LETTER OF DECEMBER 21, 1970, REFERENCE
DGSC-CF, WHICH REQUESTED A DECISION ON THE REIMBURSABILITY OF MILEAGE
AND PER DIEM TO MR. ROBERT D. RODGERS INCIDENT TO HIS ATTENDANCE AT A
COURSE OF INSTRUCTION AT FORT LEE, VIRGINIA, DURING 1970. YOUR LETTER
WAS ASSIGNED PDTATAC CONTROL NO. 71-7 BY THE PER DIEM, TRAVEL AND
TRANSPORTATION ALLOWANCE COMMITTEE AND FORWARDED HERE ON FEBRUARY 1,
1971.
MR. RODGERS, PURSUANT TO TRAVEL ORDERS ISSUED BY THE DEFENSE GENERAL
SUPPLY CENTER (DGSC) AT RICHMOND, VIRGINIA, ATTENDED A COURSE OF
INSTRUCTION FROM NOVEMBER 16 TO DECEMBER 11, 1970, AT FORT LEE,
VIRGINIA. QUARTERS WERE AUTHORIZED IN THE TRAVEL ORDERS WHICH ALSO
PRESCRIBED A PER DIEM RATE OF $5 UNDER THE PROVISIONS OF DGSC REGULATION
NO. 5000.1 OF MAY 11, 1970. YOU STATE THAT MR. RODGERS WAS PAID AT THE
RATE SPECIFIED IN THE ORDERS AND NOW CLAIMS PER DIEM AT THE RATE OF
$11.80 SINCE OTHER CIVILIAN EMPLOYEES STAYING AT FORT LEE WERE PAID AT
THAT RATE. MR. RODGER'S CORRECTED TRAVEL VOUCHER SHOWS THAT HE RETURNED
TO HIS RESIDENCE EACH WEEKEND AND THAT NO GOVERNMENT MEALS WERE TAKEN.
IN ADDITION TO THE PER DIEM RATE, A QUESTION IS RAISED CONCERNING
PAYMENT FOR MILEAGE.
THE DIFFERENCE REPRESENTS DISTANCE FROM RESIDENCE TO TEMPORARY DUTY
STATION, RATHER THAN DISTANCE BETWEEN PERMANENT DUTY STATION AND
TEMPORARY DUTY STATION AS ALLOWED.
ON NOVEMBER 9, 1970, PRIOR TO HIS TRAINING, MR. RODGERS SIGNED THE
FOLLOWING STATEMENT:
"I CERTIFY THAT I HAVE READ PARAGRAPH VI. E. 2 OF DGSC REGULATION
5000.1 AND AGREE TO ATTEND A COURSE OF INSTRUCTION AT FORT LEE,
UTILIZING GOVERNMENT QUARTERS FOR THOSE NIGHTS I REMAIN OVERNIGHT AT
FORT LEE. I UNDERSTAND THAT THE RATE OF PER DIEM PAYABLE WILL BE $5.00
PER DAY, PLUS COST OF GOVERNMENT LODGING AND THAT IF I DO NOT UTILIZE
GOVERNMENT QUARTERS, I WILL BE REQUIRED TO COMMUTE DAILY BETWEEN MY
RESIDENCE AND FORT LEE WITHOUT PER DIEM BEING PAYABLE. I AGREE TO THE
RATE OF PER DIEM AS STATED ABOVE AND WILL NOT ENTER A CLAIM FOR
ADDITIONAL PER DIEM UPON COMPLETION OF MY TDY. I FURTHER UNDERSTAND IF
I COMMUTE ON A DAILY BASIS, MILEAGE WILL BE PAID AT THE RATE OF 10[ PER
MILE NOT TO EXCEED THE DISTANCE ACTUALLY TRAVELED WHICH IS IN EXCESS OF
THE DISTANCE BETWEEN MY RESIDENCE AND THE DEFENSE SUPPLY CENTER."
THE PERTINENT PART OF DGSC REGULATION 5000.1 UNDER DATE OF MAY 11,
1970, READS:
"E. TEMPORARY DUTY TO ATTEND TRAINING COURSES
"2. FORT LEE CLASSES
"A. (SUPERSEDED) CIVILIAN AND MILITARY STUDENTS ATTENDING COURSES AT
U.S. ARMY QM SCHOOL OR ALMC, FORT LEE, VIRGINIA ARE EXPECTED TO COMMUTE
ON A DAILY BASIS. REIMBURSEMENT IS AUTHORIZED AT A RATE OF 10[ PER MILE
FOR THAT DISTANCE ACTUALLY TRAVELED WHICH IS IN EXCESS OF THE DISTANCE
BETWEEN HIS/HER RESIDENCE AND THIS CENTER.
"B. NO PER DIEM IS PAYABLE.
"C. (ADDED) EXCEPTIONS TO THIS POLICY WILL BE ON AN INDIVIDUAL CASE
BY CASE BASIS AND REQUIRE THE APPROVAL IN WRITING OF THE DEPUTY
COMMANDER PRIOR TO THE START OF THE PERIOD INVOLVED. IF APPROVAL OF AN
EXCEPTION TO THE POLICY IS GRANTED, THE 'OTHER RATE OF PER DIEM' BLOCK
IN BLOCK 13 OF THE DD FORM 1610 WILL BE CHECKED AND THE FOLLOWING WILL
BE ENTERED IN BLOCK 16:
"'IN LIEU OF COMMUTING DAILY, TRAVELER IS AUTHORIZED TO REMAIN AT
FORT LEE, AND WILL UTILIZE GOVERNMENT QUARTERS. A PER DIEM RATE OF
$5.00 APPLIES AND THE COST OF GOVERNMENT LODGING IS PAYABLE. IF FOR ANY
REASON GOVERNMENT QUARTERS ARE NOT USED, THE TRAVELER WILL COMMUTE DAILY
BETWEEN FORT LEE AND DGSC.'
"D. (ADDED) EMPLOYEES SELECTED FOR TRAINING AT FORT LEE WILL BE
REQUIRED TO SIGN ONE OF THE FOLLOWING CERTIFICATES, AS APPLICABLE, PRIOR
TO PROCESSING THE REQUEST FOR TRAVEL. CERTIFICATE WILL BE PREPARED ON
INTER-OFFICE MEMORANDUM, BY THE REQUESTING DIRECTORATE, AND WILL
ACCOMPANY THE REQUEST FOR TRAVEL. THE SIGNED CERTIFICATE WILL BE
WITHDRAWN BY THE AUTHENTICATING OFFICIAL WHEN THE TRAVEL ORDER IS
APPROVED."
YOU QUESTION THE CORRECTNESS OF THE PER DIEM RATE SO ESTABLISHED AND
THE LIMITATION IN MILEAGE ALLOWED.
WE UNDERSTAND THE TRAINING - PROPERTY OPERATIONS COURSE - WHICH IS OF
4 WEEKS DURATION IS SCHEDULED AT REGULAR RECURRING INTERVALS. SUCH
BEING THE CASE, THE AUTHORITY TO PRESCRIBE A REDUCED PER DIEM RATE FOR
ATTENDANCE AT THE TRAINING COURSE COMES WITHIN THE PROVISIONS OF THE
JOINT TRAVEL REGULATIONS (JTR), VOLUME 2, C8051-2E(2), WHICH REQUIRES
SUBMISSION OF RECOMMENDED PER DIEM RATES TO THE PER DIEM, TRAVEL AND
TRANSPORTATION ALLOWANCE COMMITTEE FOR APPROVAL AND INCLUSION IN
APPENDIX C, PART III OF THE JTR. DURING THE SUBJECT TRAINING PERIOD
THERE WAS NO PRESCRIBED REDUCED RATE INCLUDED IN JTR, APPENDIX C, PART
III, PERTAINING TO FORT LEE, VIRGINIA. WE ARE UNAWARE OF ANY PROVISIONS
IN THE JTR WHICH WOULD PERMIT THE CONSTRUCTION OF A RATE OF $5, AS
PRESCRIBED IN DGSC REGULATION 5000.1, BASED ON THE USE OF GOVERNMENT
QUARTERS. ACCORDINGLY, WHERE AS HERE GOVERNMENT QUARTERS ARE USED, THE
PROVISIONS OF JTR, VOLUME 2, C8101-2E, PRESCRIBING A PER DIEM RATE OF
$11.80 ARE FOR APPLICATION.
WITH RESPECT TO MILEAGE, JTR, VOLUME 2, C6153, AS CURRENTLY STATED,
AND AS IN EFFECT DURING THE TRAVEL HERE INVOLVED, READS AS FOLLOWS:
"WHEN THE USE OF A PRIVATELY OWNED CONVEYANCE IS AUTHORIZED OR
APPROVED AS ADVANTAGEOUS TO THE GOVERNMENT FOR TRAVEL BETWEEN THE
EMPLOYEE'S PLACE OF ABODE AND HIS TEMPORARY DUTY STATION, INSTEAD OF
REPORTING TO HIS PERMANENT DUTY STATION AND THENCE TO THE TEMPORARY DUTY
STATION, THE EMPLOYEE IS ENTITLED TO REIMBURSEMENT ON A MILEAGE BASIS
FOR THE DISTANCE TRAVELED."
PRIOR TO SEPTEMBER 1, 1970, AN OPTION WAS PROVIDED IN THE REGULATIONS
TO LIMIT MILEAGE TO AN AMOUNT REPRESENTING THE DIFFERENCE BETWEEN
REPORTING TO THE EMPLOYEE'S PERMANENT DUTY STATION AND THE TEMPORARY
DUTY STATION. THIS OPTION DID NOT EXIST DURING THE TIME HERE INVOLVED
AND, THEREFORE, THE LIMITATION TO ONLY THE EXCESS DISTANCE BETWEEN
RESIDENCE AND PERMANENT DUTY STATION AS PROVIDED IN DGSC REGULATION
5000.1 IS NOT FOR APPLICATION.
THE AGREEMENT SIGNED BY MR. RODGERS IS AT VARIANCE WITH THE GOVERNING
REGULATIONS AND THEREFORE MAY NOT BE VIEWED AS LIMITING PAYMENT OF
AMOUNTS PROPERLY DUE. THE VOUCHER IS RETURNED HEREWITH FOR PROCESSING
IN ACCORDANCE WITH THIS DECISION.
B-171923, APR 29, 1971
MILITARY PERSONNEL - CHANGE OF STATION - PER DIEM
DISALLOWING CLAIM OF WILLIAM S. MOYER, DAC, FOR PER DIEM FOR
TEMPORARY DUTY AT NEW DUTY STATION AND FOR STOPOVERS MADE ON WAY TO NEW
STATION.
CLAIMANT WAS AUTHORIZED UPON REASSIGNMENT FROM VIETNAM TO CAMP ZAMA,
JAPAN, 30 DAYS HOME LEAVE IN THE CONTINENTAL U.S. AND CONCURRENT TRAVEL
OF DEPENDENTS FROM HONOLULU TO WASHINGTON, D.C. AND FROM THE LATTER CITY
TO JAPAN. CLAIMANT ALSO SPENT 30 DAYS ON TEMPORARY DUTY ASSIGNMENT AT
CAMP ZAMA AFTER DEPARTING FROM VIETNAM AND BEFORE BEGINNING REEMPLOYMENT
LEAVE IN THE U.S.
UNDER THESE CIRCUMSTANCES PER DIEM FOR TIME AT CAMP ZAMA IS NOT
ALLOWED SINCE EMPLOYEE IS NOT ENTITLED TO PER DIEM FOR TEMPORARY DUTY
PERFORMED AT HIS PERMANENT STATION.
IN ADDITION, ALTHOUGH EMPLOYEE WAS AUTHORIZED TO STOP OVER IN
HONOLULU ON THE WAY TO AND FROM JAPAN, SUCH STOPOVERS MUST BE REGARDED
AS BEING FOR HIS PERSONAL CONVIENCE (TO PICK UP DEPENDENTS AND PROVIDE
FOR SHIPMENT OF HOUSEHOLD GOODS) PRECLUDING ANY PAYMENT OF PER DIEM.
TO MAJOR R. G. FRIEDMAN:
WE AGAIN REFER TO YOUR LETTER OF JUNE 26, 1970, REFERENCE USARJ
CO-FA, REQUESTING A DECISION WHETHER PAYMENT IS AUTHORIZED TO MR.
WILLIAM S. MOYERS, DAC, ON ENCLOSED VOUCHERS REPRESENTING HIS CLAIMS FOR
TRAVEL PERFORMED BY HIM AND HIS DEPENDENTS IN CONJUNCTION WITH PERMANENT
CHANGE OF ASSIGNMENT AND REEMPLOYMENT LEAVE, AND FOR PER DIEM FOR
TEMPORARY DUTY AT THE NEW DUTY STATION. THE REQUEST WAS ASSIGNED
PDTATAC CONTROL NO. 71-6 AND FORWARDED HERE UNDER SECOND INDORSEMENT
DATED FEBRUARY 12, 1971, BY THE PER DIEM, TRAVEL AND TRANSPORTATION
ALLOWANCE COMMITTEE.
UPON COMPLETION OF A TOUR OF DUTY IN THE REPUBLIC OF VIETNAM, MR.
MOYERS SIGNED A RENEWAL AGREEMENT FOR A NEW TOUR OF DUTY AT CAMP ZAMA,
JAPAN. BY TRAVEL ORDER NO. 145-69, DATED MAY 21, 1969, HE WAS ASSIGNED
TO CAMP ZAMA FOR DUTY AND PLACED ON TEMPORARY DUTY AT THE SAME PLACE FOR
30 DAYS. THE ORDERS AUTHORIZED 30 DAYS HOME LEAVE IN THE CONTINENTAL
UNITED STATES AND CONCURRENT TRAVEL OF DEPENDENTS (SONS) FROM HONOLULU,
HAWAII, TO WASHINGTON, D.C., AND FROM THE LATTER CITY TO JAPAN. A DELAY
OF 10 DAYS WAS AUTHORIZED IN HONOLULU EN ROUTE TO WASHINGTON, D. C., FOR
THE PURPOSE OF PICKING UP THE DEPENDENTS, AND 5 DAYS LEAVE WAS
AUTHORIZED IN HONOLULU EN ROUTE TO JAPAN. APPARENTLY, THE DELAY ON THE
RETURN TRIP WAS TO ARRANGE FOR SHIPMENT OF HOUSEHOLD EFFECTS.
THE EMPLOYEE DEPARTED VIETNAM ON JUNE 3, 1969, AND ARRIVED AT CAMP
ZAMA THE SAME DAY FOR TEMPORARY DUTY. UPON COMPLETION OF SUCH DUTY, HE
DEPARTED CAMP ZAMA ON JULY 14, 1969, FOR REEMPLOYMENT LEAVE IN THE
CONTINENTAL UNITED STATES. HE FIRST TRAVELED TO HONOLULU WHERE HE WAS
JOINED BY THREE DEPENDENTS WHO ACCOMPANIED HIM TO WASHINGTON, D. C. HE
AND THE DEPENDENTS RETURNED TO CAMP ZAMA VIA HONOLULU. HE ARRIVED AT
CAMP ZAMA ON AUGUST 14, 1969, WITH TWO DEPENDENTS. THE THIRD JOINED HIM
AT HIS STATION 2 WEEKS LATER.
IN THESE CIRCUMSTANCES YOU REQUEST OUR DECISION ON QUESTIONS STATED
IN YOUR BASIC LETTER OF NOVEMBER 6, 1969, AS FOLLOWS:
"A. IS THE EMPLOYEE ENTITLED TO PER DIEM FOR THE PERIOD OF TDY
PERFORMED AT CAMP ZAMA, JAPAN FROM 3 JUNE 1969 TO 14 JULY 1969?
"B. ARE MAC EXCESS COSTS PROPERLY CHARGEABLE TO EMPLOYEE FOR THE
EMPLOYEE'S 'STOP-OVERS' IN HAWAII ENROUTE TO AND FROM CONUS DURING
RE-EMPLOYMENT LEAVE, UNDER PROVISIONS OF USARPAC GPCO-FF LETTER,
SUBJECT: 'GOV'T COSTS OF OFFICIAL PASSENGER TRAVEL BY MILITARY AIRLIFT
COMMAND', 20 AUGUST 1968?
"C. ARE MAC EXCESS COSTS PROPERLY CHARGEABLE TO EMPLOYEE FOR
DEPENDENTS' 'STOP-OVERS' IN HAWAII ENROUTE FROM CONUS IN CONJUNCTION
WITH EMPLOYEE'S RE-EMPLOYMENT LEAVE?"
SECTION 5702(A) OF TITLE 5, U.S.C., PROVIDES THAT AN EMPLOYEE WHILE
TRAVELING ON OFFICIAL BUSINESS AWAY FROM HIS DESIGNATED POST OF DUTY IS
ENTITLED TO A PER DIEM ALLOWANCE PRESCRIBED BY THE AGENCY CONCERNED.
PARAGRAPH C1100 OF THE JOINT TRAVEL REGULATIONS FOR CIVILIAN PERSONNEL
OF THE MILITARY DEPARTMENTS DEFINES "TEMPORARY DUTY STATION" AS THE
LOCATION OF AN ACTIVITY, AREA, OR PLACE OF DUTY TO WHICH AN EMPLOYEE IS
ASSIGNED TEMPORARILY IN CONNECTION WITH GOVERNMENT BUSINESS AND FROM
WHICH HE WILL PROCEED OR RETURN TO HIS PERMANENT DUTY STATION. THE SAME
PARAGRAPH DEFINES "TEMPORARY DUTY TRAVEL" AS TRAVEL TO ONE OR MORE
PLACES AWAY FROM A PERMANENT DUTY STATION TO PERFORM DUTY FOR A
TEMPORARY PERIOD OF TIME AND UPON COMPLETION OF ASSIGNMENT RETURN TO OR
PROCEED TO PERMANENT DUTY STATION.
PARAGRAPH C3001-1 OF THE SAME REGULATIONS PROVIDES THAT TEMPORARY
DUTY TRAVEL INCLUDES ASSIGNMENTS OF A TEMPORARY NATURE AWAY FROM AN
EMPLOYEE'S PERMANENT DUTY STATION. IN ADDITION, PARAGRAPH 6.8 OF THE
STANDARDIZED GOVERNMENT TRAVEL REGULATIONS, PROMULGATED BY THE OFFICE OF
MANAGEMENT AND BUDGET PURSUANT TO 5 U.S.C. 5707, PROVIDES THAT PER DIEM
IN LIEU OF SUBSISTENCE WILL NOT BE ALLOWED AN EMPLOYEE AT HIS PERMANENT
DUTY STATION.
IT LONG HAS BEEN THE VIEW OF THIS OFFICE THAT AN EMPLOYEE IS NOT
ENTITLED TO PER DIEM FOR TEMPORARY DUTY AT HIS PERMANENT STATION. 30
COMP. GEN. 94 (1950) AND 32 COMP. GEN. 493 (1953). SEE ALSO 34 COMP.
GEN. 427 (1955) AND 38 COMP. GEN. 697 (1959). SINCE UNDER THE ORDERS OF
MAY 21, 1969, CAMP ZAMA WAS MR. MOYERS' DESIGNATED PERMANENT STATION AT
THE TIME THE TEMPORARY DUTY WAS PERFORMED NO PER DIEM IS AUTHORIZED.
SECTION 5728 OF TITLE 5, U.S.C., AUTHORIZED THE EXPENSES OF
ROUND-TRIP TRAVEL OF AN EMPLOYEE AND TRANSPORTATION OF HIS IMMEDIATE
FAMILY FROM HIS POST OF DUTY OUTSIDE THE CONTINENTAL UNITED STATES TO
THE PLACE OF HIS ACTUAL RESIDENCE AT THE TIME OF HIS APPOINTMENT OR
TRANSFER TO THE POST OF DUTY, AFTER HE HAS SATISFACTORILY COMPLETED AN
AGREED PERIOD OF SERVICE OUTSIDE THE CONTINENTAL UNITED STATES AND IS
RETURNING TO HIS ACTUAL PLACE OF RESIDENCE TO TAKE LEAVE BEFORE SERVING
AT THE SAME OR ANOTHER POST OF DUTY OUTSIDE THE CONTINENTAL UNITED
STATES UNDER A WRITTEN AGREEMENT MADE BEFORE DEPARTING FROM THE POST OF
DUTY.
PARAGRAPH C4152-1A OF THE JOINT TRAVEL REGULATIONS PROVIDES THAT
RENEWAL AGREEMENT TRAVEL IS ALLOWED FROM AN EMPLOYEE'S OVERSEAS POST OF
DUTY TO THE EMPLOYEE'S PLACE OF ACTUAL RESIDENCE AT TIME OF APPOINTMENT
AND TRANSFER TO THE OVERSEAS DUTY POST AND RETURN TO THE SAME OR ANOTHER
OVERSEAS POST OF DUTY. PARAGRAPH C6000 OF THOSE REGULATIONS PROVIDES
THAT TRAVEL PERFORMED OTHER THAN BY THE USUALLY TRAVELED ROUTE MUST BE
JUSTIFIED AS OFFICIALLY NECESSARY. WHEN FOR HIS OWN CONVENIENCE, A
PERSON TRAVELS BY AN INDIRECT ROUTE, OR INTERRUPTS TRAVEL BY A DIRECT
ROUTE, THE EXPENSE WILL BE BORNE BY HIM.
PARAGRAPH C7004 OF THE JOINT TRAVEL REGULATIONS, AS EFFECTIVE DURING
THE PERIOD HERE INVOLVED, PROVIDED THAT TRANSPORTATION OF AN EMPLOYEE'S
DEPENDENTS COULD BE AUTHORIZED IN CONNECTION WITH RENEWAL AGREEMENT OF
THE EMPLOYEE AND THAT THE POINT OF DESTINATION MUST BE THE SAME AS THAT
FOR THE EMPLOYEE. IT FURTHER PROVIDED THAT DEPENDENTS WHO DID NOT
TRAVEL TO AN OVERSEAS STATION DURING THE PRECEDING TOUR OF DUTY WOULD BE
AUTHORIZED ROUND-TRIP OR ONE-WAY TRAVEL, AS APPROPRIATE, IN CONNECTION
WITH THE EMPLOYEE'S RENEWAL AGREEMENT.
IN THE PRESENT CASE, THE EMPLOYEE'S TRAVEL WAS AUTHORIZED FROM HIS
OVERSEAS POST OF DUTY, CAMP ZAMA, TO HIS RESIDENCE, WASHINGTON, D. C.,
AND RETURN BY THE USUALLY TRAVELED ROUTE. HE WAS PERMITTED TO STOP OVER
AT HAWAII EN ROUTE TO THE UNITED STATES AS WELL AS ON THE WAY BACK TO
JAPAN. HOWEVER, SUCH STOPOVERS MUST BE REGARDED AS BEING FOR HIS
PERSONAL CONVENIENCE THUS PRECLUDING ANY PAYMENT OF PER DIEM FOR SUCH
STOPOVERS. THE SAME WOULD BE APPLICABLE TO DEPENDENTS.
THE VOUCHERS ARE RETURNED HEREWITH FOR HANDLING IN ACCORDANCE WITH
THE FOREGOING.
B-172228, APR 29, 1971
CIVILIAN EMPLOYEE - CHANGE OF STATION - TEMPORARY QUARTERS ALLOWANCE
DENYING CLAIM OF JERROLD L. RATHBUN FOR TEMPORARY QUARTERS ALLOWANCE
TO COVER EXPENSES INCURRED INCIDENT TO CHANGE OF DUTY STATION FROM
DENVER, COLORADO TO LOS ANGELES, CALIF.
CLAIM WAS PROPERLY DISALLOWED WHEN EMPLOYEE MOVED INTO PERMANENT TYPE
QUARTERS AND WAS PAID A SUM OF $200 MISCELLANEOUS EXPENSES RELATED TO
DEFRAYING COSTS ASSOCIATED WITH MOVING INTO A PERMANENT RESIDENCE
NOTWITHSTANDING THE FACT THAT EMPLOYEE MAY HAVE INTENDED AT SOMETIME IN
THE FUTURE TO MOVE INTO A LARGER APARTMENT. THIS FUTURE INTENTION IS
TOO INDEFINITE TO SUPPORT A CONCLUSION THAT THE QUARTERS WERE IN FACT
TEMPORARY.
TO MR. JERROLD L. RATHBUN:
WE AGAIN REFER TO LETTER OF MARCH 8, 1971, WRITTEN IN YOUR BEHALF BY
MR. BRUCE M. STARK, VICE-PRESIDENT, LABOR DEPARTMENT LOCAL 2391,
AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES AFL-CIO, 450 GOLDEN GATE
AVENUE, P.O. BOX 36074, SAN FRANCISCO, CALIFORNIA 94102, CONCERNING YOUR
CLAIM FOR SUBSISTENCE EXPENSES WHILE LIVING IN TEMPORARY QUARTERS
INCIDENT TO YOUR CHANGE OF DUTY STATION FROM DENVER, COLORADO, TO LOS
ANGELES, CALIFORNIA, INCIDENT TO ORDERS DATED JULY 1, 1968.
TRAVEL AUTHORIZATION DATED JULY 1, 1968, AUTHORIZED TRANSPORTATION
FOR YOU AND YOUR DEPENDENTS AND SHIPMENT OF HOUSEHOLD EFFECTS FROM
DENVER, COLORADO, TO LOS ANGELES (HAWTHORNE) CALIFORNIA, FOR THE PURPOSE
OF CHANGE OF OFFICIAL STATION. THE ORDERS ALSO AUTHORIZED REAL ESTATE
ALLOWANCES, USE OF TWO PRIVATELY OWNED VEHICLES, MISCELLANEOUS EXPENSES
NOT TO EXCEED $200 AND SUBSISTENCE EXPENSES WHILE OCCUPYING TEMPORARY
QUARTERS NOT TO EXCEED 30 DAYS.
THE RECORD SHOWS THAT ON NOVEMBER 8, 1968, YOU SIGNED BILL OF LADING
NO. 1309358 WHICH SHOWS THAT ON NOVEMBER 11, 1968, YOUR HOUSEHOLD
EFFECTS WERE LOADED AT YOUR HOME ADDRESS IN COLORADO FOR SHIPMENT TO
3613 WEST 144 STREET, LOS ANGELES (HAWTHORNE) CALIFORNIA, WITH THE
DELIVERY REQUESTED DURING THE PERIOD NOVEMBER 18 TO 22, 1968. THE
SHIPMENT WAS DELIVERED ON DECEMBER 3, 1968. YOU AND YOUR DEPENDENTS
TRAVELED FROM DENVER, COLORADO, TO LOS ANGELES, CALIFORNIA, IN TWO
AUTOMOBILES.
YOUR WIFE AND TWO CHILDREN TRAVELED IN ONE AUTOMOBILE AND YOU AND
YOUR SON IN THE OTHER, ARRIVING AT YOUR DESTINATION ON NOVEMBER 12 AND
15, 1968, RESPECTIVELY.
UPON ARRIVAL IN LOS ANGELES, YOU AND YOUR FAMILY MOVED INTO AN
UNFURNISHED APARTMENT AT 3613 WEST 144 STREET, HAWTHORNE, CALIFORNIA,
WHICH YOU HAD RENTED ON A MONTH TO MONTH BASIS.
YOUR CLAIM FOR MILEAGE FOR PERSONAL AND DEPENDENT TRAVEL, SHIPMENT OF
HOUSEHOLD EFFECTS AND MISCELLANEOUS EXPENSES ALLOWANCE IN THE SUM OF
$200 INCIDENT TO RELOCATION OF HOUSEHOLD WAS ALLOWED BY THE
ADMINISTRATIVE OFFICE. YOUR CLAIM FOR TEMPORARY QUARTERS SUBSISTENCE
EXPENSE WAS DISALLOWED FOR THE REASON THAT UPON YOUR ARRIVAL IN LOS
ANGELES, YOU MOVED INTO PERMANENT TYPE QUARTERS. BY SETTLEMENT DATED
JANUARY 15, 1971, YOUR CLAIM WAS DISALLOWED BY OUR CLAIMS DIVISION FOR
THE REASONS STATED THEREIN.
IN THE LETTER OF MARCH 8, 1971, REQUESTING REVIEW OF THE SETTLEMENT
OF JANUARY 15, 1971, THE VIEW IS EXPRESSED THAT THE UNFURNISHED
APARTMENT YOU RENTED ON A MONTH TO MONTH BASIS IN LOS ANGELES SHOULD BE
CONSIDERED TEMPORARY QUARTERS FOR THE REASON THAT THOSE PREMISES WERE
INADEQUATE TO YOUR NEEDS, THAT YOU INCURRED ADDITIONAL EXPENSES AND YOU
INTENDED TO REMAIN THERE ONLY UNTIL YOU COULD PURCHASE A HOME.
SECTION 2.5B OF OFFICE OF MANAGEMENT AND BUDGET CIRCULAR NO. A-56
(REVISED JUNE 26, 1969) PROVIDES IN PERTINENT PART AS FOLLOWS:
"(3) TEMPORARY QUARTERS REFERS TO LODGING OBTAINED TEMPORARILY BY THE
EMPLOYEE AND/OR MEMBERS OF HIS IMMEDIATE FAMILY WHO HAVE VACATED THE
RESIDENCE QUARTERS IN WHICH THEY WERE RESIDING AT THE TIME THE TRANSFER
WAS AUTHORIZED."
"(4) *** TEMPORARY QUARTERS SHOULD BE REGARDED AS AN EXPEDIENT, TO BE
USED ONLY IF, OR FOR AS LONG AS, NECESSARY UNTIL THE EMPLOYEE CAN MOVE
INTO RESIDENCE QUARTERS OF A PERMANENT TYPE."
ACCORDING TO THE INFORMATION FURNISHED BY YOU, DURING THE PERIOD
NOVEMBER 12 TO 15, 1968, YOU AND YOUR DEPENDENTS MOVED INTO AN
UNFURNISHED APARTMENT AT 3613 WEST 144 STREET, LOS ANGELES (HAWTHORNE)
CALIFORNIA. WHILE YOU EXPERIENCED SOME INCONVENIENCE BECAUSE YOUR
FURNITURE WAS NOT DELIVERED UNTIL DECEMBER 3, 1968, THE APARTMENT DID
NOT CONSTITUTE TRANSIENT LODGINGS BUT WAS HOUSING NORMALLY OCCUPIED BY
INDIVIDUALS FOR AN INDEFINITE PERIOD AND CONSIDERED PERMANENT TYPE
QUARTERS. SEE B-162510, OCTOBER 10, 1967, AND B-162239, AUGUST 28,
1967, COPIES HEREWITH. MOREOVER, THE FACT THAT YOU MAY HAVE INTENDED AT
SOMETIME IN THE FUTURE TO MOVE INTO A LARGER APARTMENT OR PURCHASE A
HOME IS TOO INDEFINITE TO SUPPORT A CONCLUSION THAT THE QUARTERS YOU
OCCUPIED WERE IN FACT TEMPORARY. IN THIS CONNECTION THERE HAS NOT BEEN
OVERLOOKED THE FACT THAT AT THE TIME YOU MOVED INTO THE APARTMENT AT
3613 WEST 144 STREET, LOS ANGELES (HAWTHORNE) CALIFORNIA, YOU WERE PAID
THE SUM OF $200 AS AN ALLOWANCE FOR MISCELLANEOUS EXPENSES. THIS
ALLOWANCE IS RELATED TO DEFRAYING VARIOUS CONTINGENT EXPENSES ASSOCIATED
WITH MOVING INTO A PERMANENT RESIDENCE IN CONNECTION WITH AN AUTHORIZED
PERMANENT CHANGE OF STATION.
ACCORDINGLY, THE DISALLOWANCE OF YOUR CLAIM FOR TEMPORARY QUARTERS
SUBSISTENCE ALLOWANCE IS SUSTAINED.
B-172259, APR 29, 1971
FOREST SERVICE APPROPRIATIONS - PAID INFORMERS
ADVISING THAT FOREST SERVICE APPROPRIATIONS UNDER THE PROVISIONS OF
16 U.S.C. 551 WHICH INVOKE THE SECRETARY OF AGRICULTURE RESPONSIBLE FOR
PROTECTION AGAINST DESTRUCTION BY FIRES AND DEPREDATIONS UPON PUBLIC
FORESTS, MAY BE USED TO PAY INFORMERS AS PART OF THE PROCEDURE BY WHICH
VIOLATORS OF THE RULES AND REGULATIONS FOR THE USE OF THE NATIONAL
FOREST LANDS ARE APPREHENDED.
TO MR. SECRETARY:
REFERENCE IS MADE TO LETTER OF MARCH 18, 1971, FROM ASSISTANT
SECRETARY T. K. COWDEN, REQUESTING OUR DECISION CONCERNING THE
AVAILABILITY OF FOREST SERVICE APPROPRIATIONS TO PAY CERTAIN EXPENSES
CONNECTED WITH THE PROTECTION OF THE NATIONAL FORESTS.
UNDER THE PROVISIONS OF 16 U.S.C. 551 THE SECRETARY OF AGRICULTURE IS
RESPONSIBLE " *** FOR THE PROTECTION AGAINST DESTRUCTION BY FIRES AND
DEPREDATIONS UPON THE PUBLIC FORESTS AND NATIONAL FORESTS *** AND HE MAY
MAKE SUCH RULES AND REGULATIONS AND ESTABLISH SUCH SERVICE AS WILL
INSURE THE OBJECTS OF SUCH RESERVATIONS, NAMELY, TO REGULATE THEIR
OCCUPANCY AND USE AND TO PRESERVE THE FORESTS THEREON FROM DESTRUCTION.
*** "
IT IS EXPLAINED THAT VIOLATORS OF THE RULES AND REGULATIONS FOR THE
USE OF THE NATIONAL FOREST LANDS EACH YEAR CAUSE THOUSANDS UPON
THOUSANDS OF DOLLARS DAMAGE TO THE NATIONAL FORESTS. SOME OF THIS
DAMAGE OCCURS BY FOREST FIRES WHICH ARE DELIBERATELY SET. OTHER
TRESPASS ACTIONS INVOLVE THE THEFT OF GOVERNMENT TIMBER, UNAUTHORIZED
OCCUPANCY, AND VANDALISM.
SINCE PREVENTION IS NOT POSSIBLE IN EVERY CASE IT IS STATED THAT YOUR
LAW ENFORCEMENT EFFORTS MUST THEN RELY ON APPREHENSION AND PROSECUTION
OF THE VIOLATORS. IN SOME CASES THE LEADS TO IDENTIFYING THE CULPRITS
ARE VERY SLIM AND CITIZEN COOPERATION IN PROVIDING INFORMATION TOWARD
DEVELOPING A COMPLETE CASE MUST BE HEAVILY RELIED ON. IN SOME CASES THE
INFORMATION NEEDED IS NOT SPONTANEOUSLY OFFERED OR IS INTENTIONALLY
WITHHELD FOR POSSIBLE MONETARY GAIN. THESE POTENTIAL INFORMANTS USUALLY
POSSESS INFORMATION WHICH COULD PROVE INVALUABLE TO SUCCESSFUL
INVESTIGATION AND IDENTIFICATION AND PROSECUTION OF VIOLATORS.
IN VIEW OF THE FOREGOING, QUESTION IS ASKED WHETHER APPROPRIATIONS
FOR THE FOREST SERVICE ARE AVAILABLE TO PAY INFORMERS WHEN IN THE
JUDGMENT OF THE INVESTIGATING OFFICER VITAL INFORMATION TO PROTECT THE
INTEREST OF THE GOVERNMENT COULD BE OBTAINED.
THE APPROPRIATIONS CURRENTLY AVAILABLE FOR THE FOREST SERVICE ARE
CONTAINED IN THE DEPARTMENT OF THE INTERIOR AND RELATED AGENCIES
APPROPRIATION ACT, 1971, APPROVED JULY 31, 1970, 84 STAT. 681, WHICH
PROVIDES FOR EXPENSES NECESSARY FOR FOREST PROTECTION AND UTILIZATION
AND THE APPROPRIATION FOR FOREST LAND MANAGEMENT SPECIFICALLY IS
AVAILABLE FOR FIGHTING AND PREVENTING FOREST FIRES.
IN VIEW OF THE MATTERS SET OUT ABOVE IT APPEARS THAT THE PAYMENT OF
COMPENSATION TO INFORMERS FOR INFORMATION CONCERNING VIOLATIONS OF THE
LAWS OR REGULATIONS RELATING TO THE PROTECTION OF THE NATIONAL FORESTS
MAY BE CONSIDERED ESSENTIAL OR NECESSARY - AS DISTINGUISHED FROM HELPFUL
OR DESIRABLE - IN THE EFFECTIVE ADMINISTRATION AND ENFORCEMENT OF SUCH
LAWS AND REGULATIONS. ACCORDINGLY, AND SINCE THERE APPEARS TO BE NO
APPLICABLE PROVISION OF LAW PROHIBITING THE PAYMENT OF COMPENSATION FOR
THE FURNISHING OF INFORMATION, WE SEE NO OBJECTION TO THE EXPENDITURE OF
FOREST SERVICE APPROPRIATIONS FOR THE PURPOSE OF SECURING INFORMATION
ADMINISTRATIVELY DETERMINED TO BE NECESSARY.
A FURTHER QUESTION HAS BEEN RAISED AS TO WHETHER THESE TRANSACTIONS
COULD BE HANDLED ON A SPOT CASH BASIS AND REIMBURSED TO THE FOREST
OFFICER MAKING PAYMENT, UPON PROPER CERTIFICATION BY HIM AND WITHIN THE
ADMINISTRATIVELY PRESCRIBED LIMITATION ON THE AMOUNT WHICH COULD BE PAID
AN INFORMER.
WE WOULD HAVE NO OBJECTION TO THE PROCEDURE PROPOSED ABOVE, HOWEVER,
THERE IS SUGGESTED FOR YOUR CONSIDERATION THAT CASH FOR PAYMENTS TO
INFORMERS COULD BE MADE AVAILABLE FROM IMPREST FUNDS ESTABLISHED IN
ACCORDANCE WITH THE REQUIREMENTS OF 7 GAO 27.
B-103315, APR 28, 1971
TRAVEL EXPENSES - GROUP TRAVEL
IN VIEW OF THE ADMINISTRATION'S REPORT OF SUBSTANTIAL SAVINGS
REALIZABLE THROUGH USE OF THE GROUP TRAVEL ARRANGEMENTS MADE BY THE
TRAVEL AGENCY OVER THE REGULAR AIR FARES PLUS PER DIEM ALLOWANCES, THE
REQUEST FOR AUTHORIZATION TO USE SUCH GROUP TRAVEL TOURS IS APPROVED, IN
CONNECTION WITH TRAVEL ORDERS FOR A GROUP OF THE ADMINISTRATION'S
SCIENTISTS TO ATTEND THE XV GENERAL ASSEMBLY OF THE INTERNATIONAL UNION
OF GEODESY AND GEOPHYSICS IN MOSCOW.
TO MR. SECRETARY:
REFERENCE IS MADE TO THE LETTER DATED APRIL 15, 1971, WITH ENCLOSURE,
FROM E. F. MCCANN, CHIEF, ADMINISTRATIVE OPERATIONS DIVISION, NATIONAL
OCEANIC AND ATMOSPHERIC ADMINISTRATION, OF YOUR DEPARTMENT, IN WHICH WE
ARE REQUESTED TO DEVIATE FROM OUR REGULATIONS COVERING THE PROCUREMENT
OF OFFICIAL PASSENGER TRANSPORTATION SERVICES.
IT IS EXPLAINED THAT THE ADMINISTRATION IS IN THE PROCESS OF
PREPARING TRAVEL ORDERS FOR A GROUP OF THE ADMINISTRATION'S SCIENTISTS
TO ATTEND THE XV GENERAL ASSEMBLY OF THE INTERNATIONAL UNION OF GEODESY
AND GEOPHYSICS IN MOSCOW, U.S.S.R., DURING THE PERIOD OF AUGUST 2 - 14,
1971. IT IS ALSO REPORTED THAT THE AMERICAN GEOPHYSICAL UNION HAS
ARRANGED THROUGH A TRAVEL AGENCY PACKAGE GROUP TOURS FOR TRAVEL DURING
THIS PERIOD TO MOSCOW. SUCH TOURS INCLUDE THE PROVISION OF LODGING AND
CERTAIN MEALS. THE LETTER INDICATES THE ADMINISTRATION'S REGULATIONS
PROVIDE FOR PERCENTAGE REDUCTION IN THE PER DIEM IN LIEU OF SUBSISTENCE
WHERE MEALS OR LODGING ARE FURNISHED. IT IS INDICATED THE TOUR
ARRANGEMENTS WILL MEET THE REQUIREMENTS OF THE ADMINISTRATION AND
PROVIDE A CONSIDERABLE SAVINGS.
IN VIEW OF THE ADMINISTRATION'S REPORT OF SUBSTANTIAL SAVINGS
REALIZABLE THROUGH USE OF THE GROUP TRAVEL ARRANGEMENTS MADE BY THE
TRAVEL AGENCY OVER THE REGULAR AIR FARES PLUS PER DIEM ALLOWANCES, THE
REQUEST FOR AUTHORIZATION TO USE SUCH GROUP TRAVEL TOURS IS APPROVED.
THE TOUR TICKETS SHOULD NOT BE OBTAINED WITH TRANSPORTATION REQUESTS
BUT SHOULD BE PAID FOR BY THE TRAVELER WHO MAY BE REIMBURSED THEREFOR
AND WE HAVE NO OBJECTION TO APPROPRIATE TRAVEL ADVANCES TO COVER THE
COSTS OF SUCH PROCUREMENT. SEE 47 COMP. GEN. 204 (1967).
B-168576(1), APR 28, 1971
BID PROTEST - SMALL BUSINESS SET ASIDE - QUANTITY REDUCTION
DENYING PROTEST OF POWERLINE OIL COMPANY AGAINST THE REDUCTION BY
DEFENSE FUEL SUPPLY CENTER OF THE SMALL BUSINESS SET-ASIDES SUBSEQUENT
TO BID OPENING UNDER AN IFB ISSUED FOR THE PROCUREMENT OF JET FUEL.
THE REDUCTION IN JET FUEL REQUIREMENTS IS PERMISSIBLE UNDER THE
SPECIAL INSTRUCTIONS AND CONDITIONS PARAGRAPH BY WHICH THE GOVERNMENT
RESERVES THE RIGHT TO MAKE AN AWARD ON ANY ITEM FOR A QUANTITY LESS THAN
THE QUANTITY OFFERED.
TO POWERINE OIL COMPANY:
REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 5, 1969, TO THE DEFENSE
FUEL SUPPLY CENTER (DFSC), PROTESTING AGAINST (1) THE SUBSTANTIAL
REDUCTION BY DFSC OF THE SMALL BUSINESS SET-ASIDES SUBSEQUENT TO BID
OPENING UNDER INVITATION FOR BIDS DSA600-70-B-0090, ISSUED FOR THE
PROCUREMENT OF JP-5 JET FUEL REQUIREMENTS, AND (2) AWARDS UNDER THE
SOLICITATION PRIOR TO A DETERMINATION OF THE SIZE STATUS OF GOLDEN EAGLE
REFINING COMPANY (GOLDEN EAGLE).
IN REGARD TO THE REDUCTION BY DFSC OF THE SET-ASIDES SUBSEQUENT TO
BID OPENING, THIS MATTER IS FULLY DISCUSSED IN OUR DECISION OF TODAY TO
U.S. OIL AND REFINING COMPANY, B-168576(2), COPY ENCLOSED. SINCE WE
BELIEVE OUR CONCLUSIONS, AS SET OUT IN THE ENCLOSURE, ARE EQUALLY
APPLICABLE TO THE QUESTION YOU HAVE RAISED, WE DO NOT FEEL THAT ANY
FURTHER DISCUSSION OF THAT ASPECT OF YOUR PROTEST IS NECESSARY.
THE ONLY QUESTION REMAINING TO BE ANSWERED IS WHETHER DFSC ACTED
IMPROPERLY BY MAKING AN AWARD TO GOLDEN EAGLE PRIOR TO RECEIPT OF A
DETERMINATION OF GOLDEN EAGLE'S ELIGIBILITY AS A SMALL BUSINESS CONCERN
FROM THE SIZE APPEALS BOARD OF THE SMALL BUSINESS ADMINISTRATION (SBA).
WE ARE ADVISED THAT THE SIZE APPEALS BOARD HAS NOW ISSUED ITS DECISION
UPHOLDING THE EARLIER DETERMINATION BY THE LOS ANGELES REGIONAL OFFICE
THAT GOLDEN EAGLE IS IN FACT A SMALL BUSINESS. SINCE THE DECISION OF
SBA REGARDING SIZE STATUS OF A COMPANY IS MADE CONCLUSIVE BY STATUTE,
NEITHER OUR OFFICE NOR THE PROCUREMENT ACTIVITY INVOLVED MAY IGNORE A
DETERMINATION BY THE SBA AS TO THE SIZE STATUS OF A PARTICULAR CONCERN.
B-169607, JUNE 16, 1970; B-150757, APRIL 8, 1963; 15 U.S.C. 637(B)(6).
ALSO, UNDER SECTION 1-703(3) OF THE ARMED SERVICES PROCUREMENT
REGULATIONS (ASPR), WHERE AN APPEAL IS MADE TO THE SIZE APPEALS BOARD
THE CONTRACTING OFFICER IS NOT REQUIRED TO SUSPEND AWARD IN ANY URGENT
PROCUREMENT WHICH THE CONTRACTING OFFICER DETERMINES IN WRITING, AS IN
THE PRESENT CASE, MUST BE AWARDED WITHOUT DELAY TO PROTECT THE PUBLIC
INTEREST. UNDER THE CIRCUMSTANCES, WE ARE UNABLE TO CONCLUDE THAT THE
CONTRACTING OFFICER ACTED IMPROPERLY BY AWARDING A CONTRACT TO GOLDEN
EAGLE PRIOR TO RECEIPT OF THE SIZE DETERMINATION FROM THE SIZE APPEALS
BOARD.
FOR THE ABOVE REASONS, AS WELL AS THOSE SET OUT IN OUR DECISION OF
TODAY TO U.S. OIL AND REFINING COMPANY WHICH ARE APPLICABLE TO YOUR
PROTEST, YOUR PROTEST MUST BE DENIED.
B-168576(2), APR 28, 1971
BID PROTEST - SMALL BUSINESS SET ASIDE - EVALUATION PROCEDURES - JET
FUEL
DENYING PROTEST OF U.S. OIL & REFINING CO., AGAINST INEQUITIES UNDER
THE PRESENT SMALL BUSINESS SET-ASIDE PROCEDURES USED IN CONNECTION WITH
THE PROCUREMENT OF JET FUEL BY THE DEFENSE FUEL SUPPLY CENTER (DFSC).
PROTESTANT QUESTIONS THE PROPRIETY OF THAT PORTION OF THE PROCEDURE
BY WHICH THE BIDS OF BIG BUSINESS CONCERNS WHICH HAVE BEEN DISPLACED BY
AWARDS TO SMALL BUSINESS CONCERNS ARE REEVALUATED IN THE FINAL COST
SOLUTION, ALLOWING THESE DISPLACED BIDS WHICH OFTEN ARE LOWER THAN THE
NONSET-ASIDE "INTERIM AWARD" PRICE USED TO DETERMINE THE PRICE OF THE
SET-ASIDE UNDER DFSC EVALUATION PROCEDURES, TO BE SUBSTITUTED FOR HIGHER
BIDS.
WHILE DFSC ACKNOWLEDGES THAT THE GOVERNMENT REALIZES A TOTAL COST
SAVING AS A RESULT OF THE SMALL BUSINESS SET-ASIDE EVALUATION PROCEDURES
USED, IT DENIES THAT THIS SAVING IS AT THE EXPENSE OF THE SMALL BUSINESS
REFINER BUT RATHER RESULTS FROM THE ECONOMICS OF THE REFINING INDUSTRY
WHERE THE GREATER THE TOTAL QUANTITY OF A SPECIFIC PETROLEUM PRODUCT AND
INDIVIDUAL REFINER PRODUCES, THE GREATER HIS REFINING COSTS WHEN
COMPARED WITH THE SALE VALUE OF ALTERNATE PRODUCTS THAT CAN BE PRODUCED
FROM CRUDE OIL.
TO U.S. OIL & REFINING CO:
REFERENCE IS MADE TO YOUR TELEGRAM OF DECEMBER 11, 1969, AND TO YOUR
LETTER, WITH ENCLOSURES, OF THE SAME DATE, PROTESTING AGAINST THE
REDUCTION OF SMALL BUSINESS SET-ASIDE QUANTITIES OF JP-5 JET FUEL
REQUIREMENTS UNDER INVITATION FOR BIDS (IFB) DSA600-70-B-0090 (HEREAFTER
0090). ALSO, IN THE ABOVE CORRESPONDENCE AND IN YOUR LETTER OF OCTOBER
21, 1970, YOU COMPLAIN OF CERTAIN INEQUITIES UNDER THE PRESENT SMALL
BUSINESS SET-ASIDE PROCEDURES USED IN CONNECTION WITH THE PROCUREMENT OF
JET FUEL REQUIREMENTS BY THE DEFENSE FUEL SUPPLY CENTER (DFSC). IN YOUR
LETTER OF OCTOBER 21 YOU PROPOSED CERTAIN CHANGES IN DFSC'S SET-ASIDE
PROCEDURES, WHICH WILL BE DISCUSSED LATER, WHICH YOU FELT WOULD
ELIMINATE MANY OF THE INEQUITIES OF WHICH YOU COMPLAIN.
IFB-0090, ISSUED ON AUGUST 15, 1969, SOLICITED BIDS TO FILL JP-5 JET
FUEL REQUIREMENTS FOR THE FIRST HALF OF 1970. BID OPENING WAS
ORIGINALLY SCHEDULED FOR SEPTEMBER 19, 1969. HOWEVER, WE ARE ADVISED
THAT DUE TO REDUCED ACTIVITIES IN SOUTHEAST ASIA AND ECONOMIES EFFECTED
THROUGHOUT GOVERNMENT, REQUIREMENTS FOR JET FUEL FLUCTUATED A GOOD DEAL.
THUS, IT WAS DECIDED TO EXTEND THE BID OPENING DATE TO OCTOBER 16,
1969, IN ORDER TO OBTAIN MORE ACCURATE INFORMATION ON JET FUEL
REQUIREMENTS. IN SPITE OF THIS PRECAUTION, HOWEVER, FIVE WEEKS AFTER
THE DATE SET FOR BID OPENING DFSC WAS INFORMED BY NAVY, ONE OF THE
REQUIRING ACTIVITIES, THAT IT (NAVY) WAS REDUCING ITS REQUIREMENTS AT A
NUMBER OF LOCATIONS ON THE WEST COAST. IN REGARD TO THOSE ITEMS IN THE
INVITATION CONTAINING SMALL BUSINESS SET-ASIDES (INCLUDING ITEM 321 FOR
THE NAVAL AIR STATION, WHIDBEY ISLAND, OAK HARBOR, WASHINGTON), THE SAME
PERCENTAGE REDUCTIONS WERE APPLIED TO BOTH THE SET-ASIDE AND
NON-SET-ASIDE QUANTITIES.
IT IS YOUR CONTENTION THAT AS A RESULT OF THE REDUCTION IN THE JP-5
JET FUEL REQUIREMENTS YOUR FIRM, AS WELL AS OTHER SMALL BUSINESS
REFINERS, HAS HAD ITS MARKET VIRTUALLY ELIMINATED. IN YOUR PARTICULAR
CASE, YOU STATE THAT YOUR FIRM LOST 80 PERCENT OF THE SUPPLY OF WHIDBEY
ISLAND NAVAL AIR STATION (ITEM 321), WHICH YOUR FIRM HAD SUPPLIED SINCE
1964. YOU FURTHER STATE THAT THE AWARD OF ITEM 321 WAS MADE TO A
REFINER LOCATED 1200 MILES FROM THE BASE, WHILE YOUR FIRM IS LOCATED
ONLY 80 MILES FROM THE BASE.
ADDITIONALLY YOU POINT OUT THAT SECTION IA 5C(B)(2) OF THE IFB
PROVIDES THAT THE GOVERNMENT SHOULD DETERMINE TO WHOM THEY SHOULD AWARD
THE SET ASIDE PORTION BASED UPON "A DETERMINATION BY THE CONTRACTING
OFFICER THAT IT IS IN THE INTEREST OF MAINTAINING OR MOBILIZING THE
NATION'S FULL PRODUCTION CAPACITY *** ." IT IS YOUR VIEW THAT SUCH A
DETERMINATION COULD NOT HAVE BEEN MADE IN THE PRESENT PROCUREMENT.
CONCERNING DFSC'S REDUCTION OF THE JP-5 JET FUEL REQUIREMENTS, WE ARE
ADVISED THAT THE CONTRACTS AWARDED UNDER IFB-0090 ARE INDEFINITE
QUANTITY TYPE CONTRACTS. MOREOVER, UNDER PARAGRAPH 10 OF THE SPECIAL
INSTRUCTIONS AND CONDITIONS THE GOVERNMENT RESERVES THE RIGHT TO MAKE AN
AWARD ON ANY ITEM FOR A QUANTITY LESS THAN THE QUANTITY OFFERED.
CONSEQUENTLY, WHILE IT IS REGRETTABLE THAT THE REDUCTIONS IN JP-5 FUEL
REQUIREMENTS HAD SUCH AN ADVERSE EFFECT ON YOUR FIRM AND OTHER SMALL
BUSINESS REFINERS, WE ARE OF THE VIEW THAT DFSC'S ACTIONS WERE PROPER
UNDER THE CIRCUMSTANCES EXISTING AT THE TIME, ESPECIALLY IN LIGHT OF
NAVY'S REDUCTION IN ITS REQUIREMENTS ON THE WEST COAST, AND CERTAINLY
WERE NOT CONTRARY TO THE BEST INTEREST OF THE GOVERNMENT.
CONCERNING YOUR CONTENTION THAT UNDER SECTION IA 5C(B)(2) OF THE IFB
THE GOVERNMENT FAILED TO DETERMINE TO WHOM AWARD SHOULD BE MADE BASED ON
"A DETERMINATION BY THE CONTRACTING OFFICER THAT IT IS IN THE INTEREST
OF MAINTAINING OR MOBILIZING THE NATION'S FULL PRODUCTION CAPACITY *** "
THERE APPEARS TO BE SOME CONFUSION CONCERNING THE INTERPRETATION OF THIS
SECTION. SECTION IA 5C(B)(2) LISTS THREE BASES FOR THE DETERMINATION TO
INCLUDE A SMALL BUSINESS SET-ASIDE IN THE SOLICITATION. ONE OF THESE
BASES IS FOR MAINTAINING OR MOBILIZING THE NATION'S FULL PRODUCTIVE
CAPACITY. HOWEVER, ANOTHER BASIS IS TO INSURE THAT A FAIR PORTION OF
GOVERNMENT PROCUREMENT IS PLACED WITH SMALL BUSINESS CONCERNS. WE ARE
ADVISED THAT UNDER IFB-0090 APPROXIMATELY 24 PERCENT OF THE TOTAL WAS
AWARDED TO SMALL BUSINESS CONCERNS WHICH WOULD APPEAR TO CONSTITUTE A
FAIR PORTION, ESPECIALLY IN VIEW OF THE FACT THAT, ACCORDING TO DFSC,
SMALL BUSINESS REPRESENTS ONLY ABOUT 7 PERCENT OF THE REFINING CAPACITY
IN THE U.S. IN ANY EVENT THE DETERMINATION, REGARDLESS OF THE BASIS FOR
IT, HAS NO BEARING ON THE SELECTION OF SUCCESSFUL CONTRACTORS. THE
SELECTION OF A SUCCESSFUL CONTRACTOR IS IN ACCORDANCE WITH PARAGRAPH IA
5C(C) WHICH STATES:
"(C) AWARD PROCEDURE.
(1) ALL OF THE OFFERS RECEIVED WILL FIRST BE EVALUATED AS THOUGH
THERE WAS NO SET-ASIDE. SMALL BUSINESS CONCERNS WILL BE OFFERED THE
SET-ASIDE PORTION AT PRICES (APPROPRIATELY ADJUSTED TO REFLECT
TRANSPORTATION AND ANY OTHER APPLICABLE EVALUATION COST FACTORS) WHICH
WILL REPRESENT WHAT THE GOVERNMENT WOULD OTHERWISE HAVE HAD TO PAY,
PURSUANT TO SUCH EVALUATION, HAD THERE BEEN NO SET-ASIDE. PROVIDED THAT
IN NO EVENT WILL SMALL BUSINESS CONCERNS BE OFFERED A PRICE LOWER THAN
THE HIGHEST UNIT PRICE DETERMINED BY SUCH EVALUATION TO BE APPLICABLE TO
THE NON-SET-ASIDE PORTION OF A PARTICULAR ITEM/LOCATION. CONTRACTS FOR
THE SET-ASIDE PORTION WILL BE NEGOTIATED WITH THOSE ELIGIBLE SMALL
BUSINESS CONCERNS WHO HAVE SUBMITTED A RESPONSIVE OFFER ON THE VARIOUS
ITEMS ON WHICH A SET-ASIDE HAS BEEN INDICATED. NEGOTIATIONS WILL
COMMENCE WITH THE SMALL BUSINESS CONCERN WHO HAS SUBMITTED THE LOWEST
OFFER ON THE NON-SET-ASIDE PORTION AND WHO HAS REMAINING A QUANTITY
WHICH WOULD NOT BE ACCEPTED UNDER THE NON-SET-ASIDE PORTION OF THE ITEM.
IF THE LOW SMALL BUSINESS CONCERN ON THE ITEM DOES NOT ACCEPT THE
SET-ASIDE QUANTITY, THE NEXT LOW SMALL BUSINESS CONCERN ON THE ITEM WILL
BE GIVEN THE SAME OPPORTUNITY AND CONTINUING WITH THE NEXT LOW SMALL
BUSINESS CONCERN UNTIL ALL SMALL BUSINESS CONCERNS HAVE BEEN CONTACTED.
FOR THIS PURPOSE, WHEN AN OFFER CONTAINS INCREMENTS AT DIFFERENT PRICES,
EACH INCREMENT WILL BE CONSIDERED A SEPARATE OFFER. EACH NEGOTIATION
WILL BE LIMITED TO THE QUANTITY OFFERED IN EACH OFFER AND NOT ACCEPTABLE
UNDER THE NON-SET-ASIDE PORTION.
(2) THE GOVERNMENT RESERVES THE RIGHT TO MAKE AWARDS TO THE OTHERWISE
LOW OFFER FOR ALL OR ANY PORTION OF THE SET-ASIDE QUANTITIES, WITHOUT
REGARD TO THE SIZE OF THE COMPANY, IF ELIGIBLE SMALL BUSINESS CONCERNS
DO NOT OFFER A QUANTITY OF PRODUCT SUFFICIENT TO MEET A SET-ASIDE OR DO
NOT ACCEPT SET-ASIDE OFFERS. THE TOTAL QUANTITY WHICH WILL BE AWARDED A
SMALL BUSINESS CONCERN ON BOTH THE UNRESERVED AND RESERVED PORTIONS WILL
NOT EXCEED THE TOTAL QUANTITY OFFERED UNDER THIS SOLICITATION BY SUCH
SMALL BUSINESS OFFER. HOWEVER, IF INSUFFICIENT PRODUCT IS OFFERED BY
SMALL BUSINESS TO MEET THE QUANTITY SET-ASIDE FOR SMALL BUSINESS, THE
SMALL BUSINESS CONCERNS WITH WHOM NEGOTIATIONS HAVE BEEN COMMENCED MAY
BE GIVEN AN OPPORTUNITY IN THE SAME ORDER AS SPECIFIED UNDER (B)(1)
ABOVE TO OFFER ADDITIONAL PRODUCT."
IT WAS IN ACCORDANCE WITH THE ABOVE PROVISION THAT GOLDEN EAGLE
REFINING COMPANY, WHO IS LOCATED 1200 MILES FROM WHIDBEY ISLAND, WAS
AWARDED 9,100,000 GALLONS OF THE 9,900,000 GALLON SET-ASIDE FOR ITEM
321. WE ARE ADVISED THAT YOUR FIRM OFFERED TWO INCREMENTS FOR DELIVERY
INTO TANKER OR BARGE AT YOUR REFINERY AT TACOMA. YOUR FIRST INCREMENT
OF 1,900,000 GALLONS AT $ .1262 PER GALLON WAS LOW AND YOU RECEIVED AN
AWARD OF 1,900,000 GALLONS AT $ .1262 (800,000 GALLONS BEING ACCEPTED
UNDER THE SET-ASIDE). HOWEVER, THE BALANCE OF THE SET-ASIDE OF
9,100,000 GALLONS WAS AWARDED TO GOLDEN EAGLE AT THEIR FIRST INCREMENT
BID PRICE OF $ .1199. GOLDEN EAGLE OFFERED A TOTAL OF 58,800,000 GALLONS
DELIVERED AT THEIR REFINERY, CARSON, CALIFORNIA, INTO U.S. GOVERNMENT'S
10 INCH MILITARY PIPELINE IN 5 INCREMENTS ASCENDING IN PRICE FROM $
.1199 PER GALLON FOR THE FIRST INCREMENT OF 18,900,000 GALLONS. THE
PIPELINE DELIVERS THE PRODUCT INTO NAVY STORAGE AT SAN PEDRO,
CALIFORNIA, FROM WHERE IT MOVES BY TANKER TO PUGET SOUND AT A COST OF $
.008324 PER GALLON. ADD TO THIS THE BARGE RATE OF $ .0052 PER GALLON
FOR THE LAST LEG OF THE JOURNEY AND A LAID DOWN PRICE AT WHIDBEY ISLAND
OF $ .133424 PER GALLON RESULTS. YOUR SECOND INCREMENT AT $ .1288 PER
GALLON, PLUS A BARGE RATE OF $ .0065 PER GALLON WOULD HAVE LAID DOWN AT
THE BASE AT A PRICE OF $ .1353 PER GALLON.
IN VIEW OF THE FOREGOING, WE SEE NO VALID BASIS FOR DISAGREEMENT WITH
DFSC'S ACTION IN REDUCING THE SET-ASIDE PORTION OF THE PROCUREMENT, OR
IN AWARDING NO GREATER AMOUNT OF THE WHIDBEY ISLAND REQUIREMENT TO YOUR
FIRM. ACCORDINGLY, YOUR PROTEST AGAINST SUCH ACTIONS MUST BE DENIED.
IN REGARD TO THE CHANGES, IN DFSC'S SMALL BUSINESS SET-ASIDE
PROCEDURES IN JET FUEL PROCUREMENTS, AS PROPOSED IN YOUR LETTER OF
OCTOBER 21, 1970, IT WOULD APPEAR DESIRABLE TO FIRST DISCUSS THE PRESENT
PROCEDURES IN MORE DETAIL THAN IS SET OUT ABOVE. THE PRESENT PROCEDURES
ARE IN ACCORD WITH AUTHORITY GRANTED TO DFSC BY THE ARMED SERVICES
PROCUREMENT COMMITTEE IN DEVIATION NUMBER 68-11 FROM SECTION
1-706.6(D)(1) OF THE ARMED SERVICES PROCUREMENT REGULATIONS (ASPR).
ASPR 1-706.6(D)(1) PROVIDES, IN PERTINENT PART, THAT AWARD OF THE
SET-ASIDE IS TO BE AT THE HIGHEST UNIT PRICE AWARDED OR TO BE AWARDED
FOR THE NON-SET-ASIDE PORTION, AND THAT NEGOTIATIONS SHALL BE CONDUCTED
WITH THOSE BIDDERS OR OFFERORS WHO HAVE SUBMITTED RESPONSIVE BIDS OR
PROPOSALS ON THE NON-SET-ASIDE PORTION AT A UNIT PRICE NO GREATER THAN
130 PERCENT OF THE HIGHEST AWARD TO BE MADE ON THE NON-SET-ASIDE
PORTION.
THE BASIC PRINCIPLE UNDERLYING DFSC'S SET-ASIDE PROCEDURE UNDER
DEVIATION NUMBER 68-11 IS THAT SMALL BUSINESS CONCERNS WILL BE OFFERED A
PRICE UNDER THE SET-ASIDE WHICH REPRESENT THE PRICE THE GOVERNMENT WOULD
OTHERWISE HAVE TO PAY FOR THE QUANTITIES SET ASIDE IF THERE WERE NO
SET-ASIDE. UNDER THIS PROCEDURE NO RESTRICTIONS ARE PLACED ON THE
QUANTITIES UPON WHICH ALL BIDDERS, LARGE AND SMALL, MAY SUBMIT BIDS.
ALL BIDDERS ARE ENCOURAGED TO BID THE MAXIMUM QUANTITIES THEY CAN SUPPLY
ON ALL ITEMS REGARDLESS OF WHETHER SUCH QUANTITIES ARE IN EXCESS OF THE
NON-SET-ASIDE REQUIREMENT FOR THE ITEM. AFTER ALL OF THE BIDS ARE
OPENED AND TRANSPORTATION COSTS ARE ADDED TO THE "ORIGIN" BIDS THE
ENTIRE PROCUREMENT IS EVALUATED BY COMPUTER WITHOUT REGARD TO
SET-ASIDES. THIS FIRST EVALUATION, WHICH IS CALLED THE FIRST MINIMUM
COST SOLUTION, ESTABLISHES THE DELIVERED PRICES WHICH WOULD HAVE TO BE
PAID TO SUPPLY EACH REQUIREMENT AT EACH LOCATION IF THERE HAD BEEN NO
SET-ASIDES. THIS INFORMATION IS CONTAINED IN AN INITIAL COMPUTER PRINT
OUT.
THE NEXT STEP IS TO DETERMINE THE PRICES WHICH WOULD HAVE TO BE PAID
FOR THE QUANTITIES SET ASIDE AT THOSE LOCATIONS WHERE SET-ASIDES WERE
ESTABLISHED IN THE IFB. THIS IS DONE ON THE BASIS OF THE ORIGINAL PRINT
OUT. FOR PURPOSES OF ILLUSTRATION TAKE A FICTITIOUS LOCATION:
XYZ AIR FORCE BASE TOTAL REQUIREMENT
10,000,000 GALLONS
SET-ASIDE QUANTITY 5,000,000 GALLONS
NON-SET-ASIDE QUANTITY 5,000,000 GALLONS
BIDS ARE EVALUATED ON THE INITIAL COMPUTER RUN AS FOLLOWS:
COMPANY A (BIG BUSINESS) 6,000,000 GAL AT $ .09
COMPANY B (BIG BISINESS) 3,000,000 GAL AT $ .092
COMPANY C (BIG BUSINESS) 1,000,000 GAL AT $ .093
SINCE THE SET-ASIDE QUANTITY IS 5,000,000 GALLONS THE PRICES WHICH
WOULD HAVE BEEN PAID FOR THAT 5,000,000 GALLONS ARE AS FOLLOWS:
COMPANY A (BIG BUSINESS) 1,000,000 GAL AT $ .09
COMPANY B (BIG BUSINESS) 3,000,000 GAL AT $ .092
COMPANY C (BIG BUSINESS) 1,000,000 GAL AT $ .093
ASSUMING THAT THERE WERE SMALL BUSINESS CONCERNS WHO BID TOO HIGH TO
RECEIVE AN AWARD ON THE NON-SET-ASIDE PORTION, A WEIGHTED AVERAGE OF THE
PRICES SHOWN ABOVE WOULD BE ESTABLISHED AS THE SET-ASIDE PRICE TO BE
OFFERED TO SMALL BUSINESS CONCERNS. IN THE FOREGOING ILLUSTRATION THE
WEIGHTED AVERAGE PRICE WOULD THEREFORE BE $ .0918, I.E., THE TOTAL
DOLLAR COST OF THE SET-ASIDE QUANTITY ($459,000) DIVIDED BY THE NUMBER
OF GALLONS (5,000,000) IN THE SET-ASIDE. THUS IF SMALL BUSINESS
CONCERNS SHOULD ACCEPT THE SET-ASIDE QUANTITY AT THE WEIGHTED AVERAGE
PRICE THERE WILL BE NO ADDITIONAL COST TO THE GOVERNMENT AS A RESULT OF
THE SET-ASIDE AND SMALL BUSINESS CONCERNS WILL HAVE RECEIVED A PRICE
WHICH EQUALS THE COST TO THE GOVERNMENT IF THERE HAD BEEN NO SET-ASIDE.
ONCE THE SET-ASIDE QUANTITIES HAVE BEEN NEGOTIATED AND AWARDS MADE IN
THE MANNER DESCRIBED ABOVE, THE REMAINING UNAWARDED BIDS ARE
REEVALUATED. IN THE SECOND EVALUATION, WHICH IS CALLED THE FINAL
MINIMUM COST SOLUTION, THE REQUIREMENT QUANTITIES AT THOSE LOCATIONS
HAVING SET-ASIDES ARE REDUCED BY THE AMOUNT OF THE SET-ASIDES ACCEPTED
BY SMALL BUSINESS. ON THE BASIS OF THE SECOND EVALUATION THE REMAINDER
OF THE AWARDS ARE MADE TO THE LOWEST BIDDERS. THUS, IN THE ILLUSTRATION
ABOVE, IF SMALL BUSINESS BIDDERS ONLY ACCEPTED 4,000,000 GALLONS OF THE
SET-ASIDE AT $ .0918, THE REMAINING 1,000,000 GALLONS WOULD BE AWARDED
TO COMPANY A AT $ .09.
YOU QUESTION THE PROPRIETY OF THAT PORTION OF THE PROCEDURE BY WHICH,
WHEN ALL OF THE SET-ASIDES HAVE BEEN NEGOTIATED IN THE ABOVE MANNER AND
AWARDS HAVE BEEN MADE TO THE SMALL BUSINESS CONCERNS, THE BIDS OF BIG
BUSINESS CONCERNS WHICH HAVE BEEN DISPLACED BY AWARDS TO SMALL BUSINESS
CONCERNS ARE REEVALUATED IN A FINAL COST SOLUTION. YOU POINT OUT THAT
THESE DISPLACED BIDS ARE OFTEN LOWER THAN THE NON-SET-ASIDE "AWARDS"
USED TO DETERMINE THE PRICE OF THE SET-ASIDES, AS IS THE CASE WITH
COMPANY A IN THE ABOVE ILLUSTRATION. UNDER THE SECOND EVALUATION HIGHER
BID PRICES ARE REPLACED BY LOWER BID PRICES. WHILE YOU MADE NO MENTION
OF IT IN YOUR OCTOBER 21 LETTER SEVERAL OTHER SMALL PRODUCERS POINTED
OUT THAT UNDER THE PRESENT PROCEDURES DFSC USES THE DISPLACED BIDS TO
PURCHASE ADDITIONAL QUANTITIES OF JET FUEL WHICH IT WOULD NOT BE
ENTITLED TO PURCHASE AT THAT PRICE HAD THERE BEEN NO SET-ASIDE. IT IS
STATED THAT THESE "NON-EXISTENT GALLONS" ARE FLOATED TO OTHER LOCATIONS
TO COVER OTHER ITEMS.
AN EXAMPLE OF HOW THIS OCCURS IS THE AWARDS UNDER ITEMS 307 AND 308
OF IFB-0090. UNDER THE FIRST EVALUATION IT WAS DETERMINED THAT THE
LOWEST LAID DOWN COST SOLUTION OR MINIMUM COST SOLUTION INCLUDED AWARDS,
FOR THE REQUIREMENTS FOR ITEMS 307 AND 308, OF PRODUCT QUANTITIES
INCLUDED IN A 16,000,000 GALLON OFFER OF $ .1143 PER GALLON BY DOUGLAS
OIL COMPANY (DOUGLAS), A LARGE BUSINESS. THIS OFFER DETERMINED THE
PRICE OFFERED TO SMALL BUSINESS ON SET-ASIDE QUANTITIES TOTALING
9,690,000 GALLONS UNDER ITEMS 307 AND 308. THE SECOND EVALUATION OR
FINAL MINIMUM COST SOLUTION, WHICH TOOK PLACE AFTER THE AWARD OF THE
9,690,000 GALLONS TO SMALL BUSINESS CONCERNS, DETERMINED THAT THE
DOUGLAS' OFFER OF $ .1143 PER GALLON WAS STILL LOW FOR THE NON-SET-ASIDE
QUANTITIES OF 1,300,000 AND 160,000 GALLONS FOR ITEMS 307 AND 308,
RESPECTIVELY. THE BALANCE OF THE 16,000,000 GALLONS OFFERED BY DOUGLAS
AT $ .1143 PER GALLON WAS FOUND LOW FOR 1,300,000 GALLONS FOR ITEM 306;
360,000 GALLONS FOR ITEM 310; 1,985,000 GALLONS FOR ITEM 314; 164,000
GALLONS FOR ITEM 322; 4,260,000 GALLONS FOR ITEM 325; AND 7,935,000
GALLONS FOR OFFSHORE MOVEMENT TO JAPAN, ITEM 326. DOUGLAS WAS AWARDED A
CONTRACT FOR 16,000,000 GALLONS AT $ .1143 PER GALLON. THUS, IT IS
APPARENT THAT THE GOVERNMENT OBTAINED 25,690,000 GALLONS OF JP-5 JET
FUEL AT $ .1143 PER GALLON, WHEREAS, HAD THERE BEEN NO SMALL BUSINESS
SET-ASIDE THE GOVERNMENT WOULD HAVE RECEIVED ONLY 16,000,000 GALLONS AT
THE PRICE OF $ .1143 PER GALLON.
IN YOUR LETTER OF OCTOBER 21, YOU PROPOSE THAT THE FIRST COMPUTER
EVALUATION RUN SHOULD INCLUDE BIDS OF BOTH LARGE AND SMALL REFINERS,
SOLICITED AGAINST THE TOTAL PROCUREMENT QUANTITIES, BUT LIMITED IN THIS
EVALUATION TO NON-SET-ASIDE REQUIREMENTS ONLY. AWARDS WOULD THEN BE
MADE COVERING THE NON-SET-ASIDE REQUIREMENTS AND ALL BIDS RECEIVED WOULD
BE REDUCED TO REFLECT QUANTITIES AND PRICES OF THESE AWARDS. THESE
MODIFIED BIDS WOULD THEN BE ENTERED INTO A SECOND COMPUTER EVALUATION
RUN AGAINST THOSE REQUIREMENTS SET ASIDE FOR SMALL BUSINESS. THIS
SECOND COMPUTER SOLUTION WOULD BE USED TO ESTABLISH PRICES THE
GOVERNMENT WOULD HAVE TO PAY BUT FOR THE SMALL BUSINESS SET-ASIDE. THE
SET-ASIDE QUANTITIES WOULD THEN BE OFFERED TO ELIGIBLE SMALL BUSINESS
REFINERS IN THE ORDER OF THEIR COMPETITIVE POSITIONS IN THE FORMAL
BIDDING (AND TO THE EXTENT THEY HAD QUANTITIES OFFERED, BUT UNAWARDED,
ON THE NON-SET-ASIDE).
FOLLOWING RECEIPT OF YOUR SUGGESTION FOR REVISION, AS OUTLINED ABOVE,
DFSC CONDUCTED A TEST BY USING YOUR PROPOSED PROCEDURE IN AN EVALUATION
OF ALL BIDS RECEIVED IN RESPONSE TO IFB DSA600-70-0161 (HEREAFTER 0161)
FOR JP-4 JET FUEL REQUIREMENTS FOR THE PERIOD FROM JULY 1 THROUGH
DECEMBER 31, 1970. THESE TEST RESULTS WERE THEN COMPARED TO RESULTS
OBTAINED IN AN EVALUATION OF THE SAME BIDS UNDER PRESENT PROCEDURES,
PURSUANT TO WHICH CONTRACTS WERE ACTUALLY AWARDED. AS A RESULT, IT WAS
DETERMINED THAT NOT ONLY WERE THE PROCEDURES YOU PROPOSED MORE TIME
CONSUMING AND COMPLEX THAN THE PRESENT PROCEDURES, THEY ALSO WOULD HAVE
RESULTED IN ADDITIONAL TOTAL COSTS TO THE GOVERNMENT OF $144,181.51
($216,175,881.36 AS COMPARED TO THE TOTAL COST IN THE ACTUAL, INITIAL
COMPUTER EVALUATION UNDER IFB-0161 OF $216,031,699.85).
MOREOVER, DFSC WAS OF THE OPINION THAT EVEN IF THE PROCEDURES
PROPOSED BY YOU WERE ADOPTED BY DFSC, IT WOULD NOT SOLVE THE PROBLEMS
FACING YOUR FIRM AND OTHER SMALL REFINERS IN A SIMILAR SITUATION. IN
THIS CONNECTION, WHILE DFSC ACKNOWLEDGES THAT THE GOVERNMENT REALIZES A
TOTAL COST SAVING AS A RESULT OF THE SMALL BUSINESS SET-ASIDE PRESENTLY
USED, IT DENIES THAT THIS SAVING IS AT THE EXPENSE OF THE SMALL BUSINESS
REFINER. INSTEAD, IT IS DFSC'S POSITION THAT THIS SAVING STEMS FROM THE
ECONOMICS OF THE PETROLEUM REFINING INDUSTRY, AS ILLUSTRATED BY THE FACT
THAT THE GREATER THE TOTAL QUANTITY OF A SPECIFIC PETROLEUM PRODUCT AN
INDIVIDUAL REFINER PRODUCES, THE GREATER HIS REFINING COSTS ARE WHEN
COMPARED WITH THE SALE VALUE OF ALTERNATE PRODUCTS THAT CAN BE PRODUCED
FROM THE CRUDE OIL. FOR THIS REASON, AN INDIVIDUAL REFINER WILL BID HIS
PRODUCT IN INCREMENTS WHICH ARE SUCCESSIVELY HIGHER FOR EACH INCREMENT,
WHICH MAY WELL RESULT IN SET-ASIDE PRICES DECREASING AS THE PERCENTAGE
OF THE TOTAL PROCUREMENT WHICH IS SET-ASIDE INCREASES.
DFSC ALSO POINTS OUT THAT UNDER YOUR PROPOSED PROCEDURES AWARD FOR
THE NON-SET-ASIDE QUANTITIES WOULD BE MADE PRIOR TO NEGOTIATION OF THE
SET-ASIDE AWARDS. THIS WOULD DENY THE GOVERNMENT THE BENEFIT OF THE
FINAL MINIMUM COST SOLUTION WHICH, AS EXPLAINED ABOVE, RESORTS ALL
UNACCEPTED BID QUANTITIES TO ACHIEVE THE MOST ECONOMICAL AWARD PATTERN
ON THE BASIS OF DISTRIBUTION COSTS. AS AN EXAMPLE, UNDER IFB-0161 THE
AMOUNT OF SAVINGS ($334,874.80) ACCRUING TO THE GOVERNMENT AS A RESULT
OF THE FINAL MINIMUM COST SOLUTION GREATLY EXCEEDS THE AMOUNT
($144,181.51) BY WHICH SMALL BUSINESS REFINERS WOULD HAVE BEEN BENEFITED
UNDER THE PROCEDURES PROPOSED BY YOU.
IN VIEW OF THE FOREGOING, DFSC IS OF THE OPINION THAT THE PRESENT
METHOD OF EVALUATING AND ESTABLISHING SET-ASIDE PRICES IS EMINENTLY FAIR
TO SMALL BUSINESS CONCERNS, AND THAT THE SMALL BUSINESS REFINER HAS THE
OPPORTUNITY OF OBTAINING HIGHER PRICES UNDER DEVIATION 68-11 THAN IF THE
STANDARD ASPR PROCEDURE WAS FOLLOWED. DFSC THEREFORE HAS CONCLUDED THAT
IT WILL NOT IMPLEMENT THE CHANGES PROPOSED BY YOU.
THE SELECTION OF APPROPRIATE PROCEDURES FOR IMPLEMENTING SET-ASIDE
PROCUREMENTS OF JET FUEL ARE PRIMARILY FOR DETERMINATION BY DFSC, AND
THIS OFFICE WILL NOT SUBSTITUTE ITS JUDGMENT FOR THAT OF DFSC UNLESS IT
HAS ACTED IN AN ARBITRARY OR CAPRICIOUS MANNER. BASED UPON THE RECORD,
AS SET OUT ABOVE, IT IS OUR OPINION THAT THERE IS SUBSTANTIAL EVIDENCE
TO SUPPORT DFSC'S DECISION NOT TO REVISE PRESENT SMALL BUSINESS
SET-ASIDE PROCEDURES USED IN CONNECTION WITH THE PROCUREMENT OF JP-4 AND
JP-5 JET FUEL.
ACCORDINGLY, YOUR PROTEST AGAINST USE OF SUCH PROCEDURES, AND YOUR
REQUEST FOR REVISIONS, MUST BE DENIED.
B-169296, APR 28, 1971
BID PROTEST - SMALL BUSINESS SET ASIDE - INDIVIDUAL ITEM V AREA BASIS
DENYING PROTEST OF FLETCHER OIL AND REFINING COMPANY AGAINST
PROCEDURES USED BY DFSC IN ITS AWARD OF SMALL BUSINESS SET-ASIDE.
PROTESTANT'S SUGGESTION THAT SET-ASIDES BE ESTABLISHED ON AN AREA
RATHER THAN AN INDIVIDUAL ITEM BASIS MIGHT WELL BE CONTRARY TO THE
DECISION 41 COMP. GEN. 306 (1961), WHERE THE "FLOATING SET ASIDE" WAS
DISAPPROVED BECAUSE IT FAILED TO GIVE BIDDERS ADEQUATE ADVANCE NOTICE OF
THE BASIS UPON WHICH THEIR BIDS WOULD BE EVALUATED.
TO FLETCHER OIL AND REFINING COMPANY:
REFERENCE IS MADE TO YOUR LETTER OF MARCH 9, 1970, AND TELEGRAM OF
MARCH 16, 1970, PROTESTING AGAINST CERTAIN PROCEDURES ADOPTED BY THE
DEFENSE FUEL SUPPLY CENTER IN ITS ADMINISTRATION OF THE PETROLEUM SMALL
BUSINESS SET-ASIDE PROGRAM.
IN THE THIRD PARAGRAPH OF YOUR LETTER OF MARCH 9 YOU SUGGEST THAT THE
PRESENT SYSTEM, WHICH ESTABLISHES SET-ASIDES ON AN INDIVIDUAL ITEM BASIS
RATHER THAN ON AN AREA BASIS, MAY BE THE CAUSE OF THE SEVERE IMPACT ON
MANY SMALL BUSINESS CONCERNS WHEN A BASE HAVING A LARGE SET-ASIDE CLOSES
DOWN. SINCE IT WOULD APPEAR THAT YOU ARE SUGGESTING THE DEFENSE FUEL
SUPPLY CENTER (DFSC) ADOPT A SYSTEM WHEREBY THE SET-ASIDES ARE ON A
GEOGRAPHIC AREA BASIS, WE MUST POINT OUT THAT SUCH A SYSTEM MIGHT WELL
BE CONTRARY TO OUR DECISION PUBLISHED AT 41 COMP. GEN. 306 (1961). IN
THAT DECISION WE PROHIBITED FUTURE USE OF THE "FLOATING SET-ASIDE"
PROCEDURE UTILIZED BY THE PROCURING AGENCY UNDER WHICH ONLY THE QUANTITY
SET ASIDE FOR THE WHOLE NATION WAS KNOWN PRIOR TO BID OPENING; AND THE
SPECIFIC QUANTITY TO BE SET ASIDE FOR SMALL BUSINESS CONCERNS AT
PARTICULAR LOCATIONS WAS NOT DETERMINED UNTIL AFTER THE BIDS WERE
OPENED. WE STATED THAT UNDER SUCH A PROCEDURE THE BIDDERS HAD NO
ADVANCE NOTICE OF THE BASIS UPON WHICH THEIR BIDS WOULD BE EVALUATED,
AND THEY THEREFORE WOULD BE UNABLE TO SUBMIT INTELLIGENT COMPETITIVE
BIDS. DEPENDING, OF COURSE, TO A CERTAIN DEGREE ON THE SIZE OF THE
GEOGRAPHIC AREA THAT YOU WOULD HAVE DFSC USE, IT WOULD APPEAR THAT ANY
PROCEDURE WHICH ESTABLISHES SET-ASIDES ON A GEOGRAPHIC AREA BASIS WOULD
HAVE THE SAME SHORTCOMINGS AS THE "FLOATING SET-ASIDE" SYSTEM.
ADDITIONALLY, IT IS NOT APPARENT HOW ESTABLISHMENT OF SET-ASIDES ON A
GEOGRAPHIC AREA BASIS WOULD EASE THE IMPACT OF POSSIBLE REDUCTIONS IN
REQUIREMENTS PRIOR TO AWARD. WE AGREE WITH DFSC'S POSITION THAT IN THE
FINAL ANALYSIS, SET-ASIDES MUST BE ESTABLISHED WITH REGARD TO THE
LOCATIONS TO WHICH PRODUCTS OF SMALL BUSINESS REFINERS CAN BE MOVED OR
DELIVERED ECONOMICALLY, AND THE ESTIMATED REQUIREMENTS OF PARTICULAR
BASES MUST BE CONSIDERED. THEREFORE, EVEN IF SET-ASIDE QUANTITIES WERE
NOT IDENTIFIED IN A SOLICITATION WITH THE REQUIREMENTS OF SPECIFIC
BASES, REDUCTIONS OF REQUIREMENTS AT PARTICULAR BASES WOULD OF NECESSITY
HAVE AN EQUAL EFFECT ON ANY AREA SET-ASIDE.
THE REMAINDER OF THE QUESTIONS RAISED IN YOUR LETTER AND TELEGRAM ARE
ANSWERED IN OUR DECISION OF TODAY TO U.S. OIL AND REFINING COMPANY,
B-168576(2), COPY ENCLOSED.
FOR THE REASONS SET OUT ABOVE, AND IN OUR DECISION OF TODAY TO U.S.
OIL AND REFINING, YOUR PROTEST MUST BE DENIED.
B-170608, APR 28, 1971
CONTRACTS - AWARDS - BUY INDIAN ACT
CONCERNING PLACEMENT OF CERTAIN CONTRACTS FOR LAUNDRY SERVICES BY
BUREAU OF INDIAN AFFAIRS UNDER THE SO-CALLED "BUY INDIAN ACT", 25 U.S.C.
47. COMPLAINTS BY COMPANIES DENIED PERMISSION TO BID ALLEGE THAT AWARD
MADE IMPROPERLY TO "STRAW" INDIAN COMPANY AND THAT INDIAN CAPITAL IS
UNFAIRLY FAVORED OVER INDIAN LABOR.
SUGGEST BUREAU OF INDIAN AFFAIRS RE-VERIFY OWNERSHIP OF LUKEE
ENTERPRISES TO CONFIRM ITS STATUS AS A COMPANY WHICH IS AT LEAST 51%
INDIAN-OWNED AS REQUIRED BY BUREAU STANDARDS FOR SUCH AWARD. FURTHER,
THAT THE BUREAU IN ITS REVIEW OF PRESENT GUIDE LINES FOR SUCH AWARDS
CONSIDER THE FEASIBILITY OF FAVORING FIRMS EMPLOYING INDIAN LABOR AS
OPPOSED TO POSSESSING INDIAN OWNERSHIP.
TO MR. SECRETARY:
BY LETTERS DATED NOVEMBER 30, 1970, FEBRUARY 16, AND MARCH 15, 1971,
THE DEPUTY ASSISTANT SECRETARY FOR ADMINISTRATION AND THE DIRECTOR OF
SURVEY AND REVIEW FURNISHED US WITH REPORTS CONCERNING THE PLACEMENT BY
THE BUREAU OF INDIAN AFFAIRS OF CERTAIN CONTRACTS FOR LAUNDRY SERVICES
BY SOLE-SOURCE NEGOTIATION UNDER THE SO-CALLED "BUY INDIAN" ACT, 25
U.S.C. 47.
THIS MATTER WAS FORWARDED TO US BY A CONGRESSIONAL SOURCE WHO HAD
RECEIVED COMPLAINTS FROM ATTORNEYS REPRESENTING COMPANIES WHICH WERE NOT
PERMITTED TO BID ON THE INVOLVED CONTRACTS. THE ATTORNEYS ALLEGED THAT
ONE OF THE FIRMS CHOSEN TO RECEIVE AN AWARD, LUKEE ENTERPRISES, INC.,
DID NOT, IN FACT, HAVE THE 51 PERCENT INDIAN OWNERSHIP REQUIRED TO
QUALIFY FOR NEGOTIATION PURSUANT TO A BUREAU OF INDIAN AFFAIRS
MEMORANDUM SETTING OUT QUALIFICATIONS FOR SUCH AWARDS, APPARENTLY ON THE
BASIS THAT THE CLAIMED INDIAN OWNERSHIP IS A SHAM. A FURTHER INTIMATION
OF IMPROPRIETY IS CONTAINED IN THE STATEMENT TO A PRIVATE INVESTIGATOR
BY THE WIFE OF THE 51-PERCENT OWNER OF A SECOND FIRM RECEIVING A "BUY
INDIAN" AWARD, ELITE LAUNDRY COMPANY, INC., TO THE EFFECT THAT ELITE
"FINALLY WISED UP" BY TAKING SOME UNSPECIFIED ACTION IN ORDER TO RECEIVE
"BUY INDIAN" AWARDS. A THIRD AWARD, PROPOSED AT THE TIME OF THE
COMPLAINTS TO BE MADE TO AN INDIAN-OWNED FIRM ALLEGEDLY NOT POSSESSING
REQUIRED EQUIPMENT OR CAPITAL, IS ALSO CRITICIZED. FINALLY, THE
COMPLAINT IS MADE BY ONE OF THE ATTORNEYS THAT "IT WOULD SEEM THAT THE
BUREAU OF INDIAN AFFAIRS HAS EXERCISED ITS DISCRETION AGAINST MANY
INDIANS WHO NEED EMPLOYMENT AND IN FAVOR OF ONE INDIAN WHO HAPPENS TO
HAVE THE CAPITAL OR BACKING TO HAVE BOUGHT INTO A BUSINESS."
YOUR REPORTS TO OUR OFFICE POINT OUT THAT ON AUGUST 22, 1968, POLICY
MEMORANDUM ISSUED BY THE COMMISSIONER OF INDIAN AFFAIRS IMPLEMENTS THE
STATUTORY INJUNCTION THAT INDIAN LABOR AND INDUSTRY BE FAVORED, WHERE
PRACTICABLE, BY ALLOWING, WITHIN THE DISCRETION OF THE BUREAU, THE
NEGOTIATION OF CONTRACTS WITH INDIAN FIRMS (THOSE HAVING 51 PERCENT OR
MORE INDIAN OWNERSHIP IN THIS INSTANCE) ON A SOLE-SOURCE OR WHERE
FEASIBLE, A COMPETITIVE BASIS, TO THE EXCLUSION OF NON-INDIAN FIRMS.
YOU ADVISE THAT FISCAL YEAR 1971 CONTRACTS WERE AWARDED TO LUKEE
ENTERPRISES FOR THE EASTERN NAVAJO AND SHIPROCK AGENCIES AND TO ELITE
LAUNDRY COMPANY, INC., FOR THE CHINLE AND FORT DEFIANCE AGENCIES UNDER
THE "BUY INDIAN" GUIDELINES. A THIRD CONTRACT, FOR THE TUBA CITY
AGENCY, WAS AWARDED TO LUKEE ENTERPRISES ON AN UNRESTRICTED ADVERTISED
COMPETITIVE BASIS AFTER THE FIRM ORIGINALLY SLATED TO RECEIVE A "BUY
INDIAN" AWARD FAILED TO SECURE NECESSARY FINANCING.
ON THE QUESTION OF THE LEGITIMACY OF THE INDIAN OWNERSHIP OF LUKEE
ENTERPRISES, YOU ITERATE THE POSITION TAKEN IN A PREVIOUS SIMILAR CASE
BEFORE OUR OFFICE THAT YOUR DEPARTMENT DOES NOT CONDONE "THE SETTING UP
OF 'STRAW' ORGANIZATIONS WHICH APPEAR TO BE BUT IN REALITY ARE NOT BONA
FIDE INDIAN INDUSTRIES," AND STATE THAT 52 PERCENT OF THE LUKEE
ENTERPRISES, INC., STOCK IS HELD BY MRS. JUANITA LUKEE, AN ACOMA
INDIAN. IN SUBSTANTIATION OF YOUR POSITION THAT MRS. LUKEE IS NOT A
"STRAW," THE ADMINISTRATIVE FILE INDICATES THAT LUKEE ENTERPRISES WAS
INCORPORATED PRIOR TO JUNE 1970 WITH HENRY LUKEE, MRS. JUANITA LUKEE'S
HUSBAND AND A FULLBLOOD ZUNI INDIAN, AS OWNER OF 52 PERCENT OF THE 1,000
SHARES OF STOCK ORIGINALLY ISSUED. EVIDENCE OF THE BONA FIDE NATURE OF
THE CORPORATION IS INDICATED BY A BILL OF SALE FROM CHARLES M. PRESTON,
A WHITE MAN WHO IS THE 48 PERCENT STOCKHOLDER IN LUKEE ENTERPRISES,
CONVEYING WASHERS, DRYERS, MOTOR VEHICLES, ETC., TO THE CORPORATION AND
BY THE EXISTENCE OF SEVERAL PROMISSORY NOTES FROM THE CORPORATION
PAYABLE TO MR. PRESTON AND OTHERS FOR THE PURCHASE OF VARIOUS LAUNDRY
BUSINESSES AND EQUIPMENT. IT IS REPORTED THAT UPON HENRY LUKEE'S DEATH
IN APRIL 1970, MRS. LUKEE BECAME CHAIRMAN OF THE BOARD OF LUKEE
ENTERPRISES, INC., ALTHOUGH SHE HAD NO PREVIOUS LAUNDRY MANAGEMENT
EXPERIENCE, AND ALSO APPARENTLY INHERITED THE 52 PERCENT SHARE OF LUKEE
ENTERPRISES PREVIOUSLY HELD BY HER HUSBAND.
WHILE WE CANNOT CONCLUDE ON THE BASIS OF THE PRESENT RECORD THAT
LUKEE ENTERPRISES IS NOT A BONA FIDE INDIAN CONCERN UNDER THE BUREAU OF
INDIAN AFFAIRS GUIDELINES, WE NOTE THAT WHILE THE FILE NOTES THAT MRS.
LUKEE IS CHAIRMAN OF THE BOARD AND OWNER OF 52 PERCENT OF THE ISSUED
STOCK, IT CONTAINS NO INFORMATION, OTHER THAN A STATEMENT THAT THE WILL
OF HENRY LUKEE WAS FILED FOR PROBATE, OF HOW AND WHEN MRS. LUKEE
ACQUIRED HER 52-PERCENT OWNERSHIP IN THE BUSINESS. ALSO, WE NOTE THAT
THE ORIGINAL 52-PERCENT OWNERSHIP OF HENRY LUKEE WAS PREDICATED ON HIS
OWNERSHIP OF 520 OF THE 1,000 SHARES ORIGINALLY ISSUED, ALTHOUGH THE
ARTICLES OF INCORPORATION OF THE CORPORATION PROVIDE FOR A TOTAL CAPITAL
STOCK OF 100,000 SHARES. WE THEREFORE SUGGEST THAT THE 52-PERCENT
OWNERSHIP OF MRS. LUKEE BE REVERIFIED BEFORE NEGOTIATION OF ANY
ADDITIONAL "BUY INDIAN" CONTRACTS WITH LUKEE ENTERPRISES.
ON THE QUESTION OF THE "WISING UP" OF THE ELITE LAUNDRY COMPANY, THE
ADMINISTRATIVE REPORT SUGGESTS THAT THIS COMMENT REFERRED TO THE FACT
THAT A PURCHASE AGREEMENT IN MARCH 1969 CONVEYED 51 PERCENT OF ELITE'S
STOCK TO RAY CHRISTENSEN, A HALFBLOOD NAVAJO INDIAN WHO HAD REPORTEDLY
BEEN ASSOCIATED WITH ELITE FOR SEVERAL YEARS IN A MANAGERIAL,
NONOWNERSHIP CAPACITY. ALTHOUGH THE ALLEGATION IS MADE THAT ELITE HAS
QUALIFIED FOR "BUY INDIAN" CONTRACTS "FOR THE PAST FOUR YEARS," IT WOULD
APPEAR THAT THE COMPANY DID NOT, IN FACT, QUALIFY UNDER PRESENT
GUIDELINES UNTIL THE MARCH 1969 PURCHASE AGREEMENT MENTIONED ABOVE
BROUGHT IN MAJORITY INDIAN OWNERSHIP. HOWEVER, WE WOULD THINK THAT THE
BUREAU, AS A MINIMUM, IN THE INTERESTS OF ASSURING THAT THE "BUY INDIAN"
PROGRAM IS BEING ADMINISTERED PROPERLY, WOULD HAVE INTERVIEWED MRS.
CHRISTENSEN TO DISCOVER THE EXACT MEANING OF HER STATEMENT.
WITH RESPECT TO THE COMPLAINT THAT THE BUREAU OF INDIAN AFFAIRS
PRACTICES IN AWARDING CONTRACTS FAVOR INDIAN-OWNED BUSINESSES OVER
BUSINESSES EMPLOYING INDIAN LABOR, IT IS OUR UNDERSTANDING THAT THE
PRESENT POLICY GUIDELINES ARE BEING REVIEWED TOWARD THE END OF BETTER
PROTECTING THE INTERESTS OF INDIAN LABOR AND INDUSTRY. POSSIBLY, THE
FEASIBILITY OF FAVORING FIRMS EMPLOYING INDIAN LABOR AS OPPOSED TO THOSE
POSSESSING INDIAN OWNERSHIP COULD BE CONSIDERED IN THE REVIEWING
PROCESS.
B-171289, APR 28, 1971
BID PROTEST - SMALL BUSINESS SET ASIDE - PRICE
DENYING PROTEST OF EDGINGTON OIL COMPANY AGAINST THE PROCEDURES BY
WHICH THE DEFENSE FUEL SUPPLY CENTER (DFSC) DETERMINES THE PRICE AND
QUANTITIES FOR SMALL BUSINESS SET-ASIDE AWARDS FOR JET FUEL.
WHILE NEITHER LARGE NOR SMALL BUSINESS REFINERS CAN DETERMINE THE
QUANTITY OR POINT OF DELIVERY OF THE PRODUCT UPON WHICH THEY ARE
BIDDING, THIS UNCERTAINTY IS THE CONSEQUENCE OF A REQUIREMENTS TYPE
CONTRACT AND THE MINIMUM COST SOLUTION USED TO ALLOCATE AWARDS TO THE
VARIOUS BIDDERS. ALL BIDDERS ARE SUBJECT TO THE SAME UNCERTAINTY AND
THE PROCEDURES RESULT IN THE LOWEST COST TO THE GOVERNMENT.
TO EDGINGTON OIL COMPANY:
REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 13, 1970, WITH
ENCLOSURES, RELATING TO THE METHODS AND PROCEDURES BY WHICH THE DEFENSE
FUEL SUPPLY CENTER (DFSC) DETERMINES THE PRICE FOR SMALL BUSINESS
SET-ASIDE QUANTITIES OF JET FUELS.
IT IS YOUR CONTENTION THAT UNDER THE PRESENT PROCEDURES (EXPLAINED IN
DETAIL IN OUR DECISION OF TODAY, B-168576(2), TO U.S. OIL AND REFINING
CO., COPY ENCLOSED) NEITHER LARGE NOR SMALL BUSINESS REFINERS CAN
DETERMINE THE QUANTITY OR POINT OF DELIVERY OF THE PRODUCT UPON WHICH
THEY ARE BIDDING. YOU STATE THAT THIS CONFUSING CONDITION EXISTS NOT
ONLY BEFORE BUT AFTER BID OPENING. YOU CONTEND THAT THE EVALUATION
PROCEDURE DEFEATS THE CONGRESSIONAL PURPOSE AND INTENT IN ESTABLISHING
THE SMALL BUSINESS SET ASIDE PROCEDURE, AND THAT IT IS CONTRARY TO THE
REQUIREMENT OF FORMALLY ADVERTISED PROCUREMENTS THAT BIDDERS BE NOTIFIED
IN ADVANCE OF THE BASIS ON WHICH THEIR BIDS WILL BE EVALUATED. ALSO,
YOU CONTEND THAT THE PRESENT PROCEDURES ARE CONTRARY TO DFSC'S STATED
POLICY THAT "THE PRICE AT WHICH AWARDS SHALL BE MADE TO SMALL BUSINESS
CONCERNS IS DETERMINED WITHOUT REFERENCE TO THE PRICE OR PRICES AT WHICH
AWARDS ARE MADE ON THE NON-SET-ASIDE PORTION."
IN YOUR LETTER OF NOVEMBER 11, 1970, TO DFSC YOU DESCRIBE A PROCEDURE
FOR THE AWARD OF SET-ASIDES WHICH YOU CLAIM WAS USED UP UNTIL A COUPLE
OF YEARS AGO. THE PROCEDURE YOU DESCRIBE APPEARS TO BE SIMILAR TO THE
REVISED PROCEDURE SUGGESTED BY U.S. OIL AND REFINING CO., IN ITS LETTER
OF OCTOBER 21, 1970, WHICH WAS REJECTED BY DFSC FOR THE REASONS SET OUT
IN THE ENCLOSED COPY OF OUR DECISION OF TODAY. MOREOVER, DFSC STATES
THAT THE PRESENT PROCEDURES HAVE BEEN IN USE SINCE 1961 AND WHILE THESE
PROCEDURES WERE EXPLAINED AT THE MEETING OF MARCH 18, 1969, DISCUSSED IN
YOUR NOVEMBER 11 LETTER, NO NEW PROCEDURES WERE ADOPTED AT THAT TIME.
ADMITTEDLY UNDER THE PRESENT PROCEDURES NEITHER LARGE NOR SMALL
BUSINESS REFINERS ARE ABLE TO DETERMINE THE EXACT QUANTITY OF FUEL UPON
WHICH THEY ARE BIDDING, DUE TO THE FACT THAT UNDER A REQUIREMENTS TYPE
CONTRACT THE PROCURING ACTIVITY DOES HAVE THE OPTION OF REDUCING THE
QUANTITY SHOULD ITS REQUIREMENTS DECLINE. HOWEVER, IT IS WELL
ESTABLISHED THAT REQUIREMENTS TYPE CONTRACTS ARE PROPER UNDER
APPROPRIATE CIRCUMSTANCES, AND WE DO NOT BELIEVE THAT IT WOULD BE IN THE
GOVERNMENT'S BEST INTEREST IN THE PROCUREMENT OF JET FUEL TO REQUIRE THE
PROCURING ACTIVITY TO ACCEPT IN ALL INSTANCES THE AMOUNT OF FUEL SET OUT
IN THE IFB.
IT IS ALSO TRUE THAT NEITHER LARGE NOR SMALL REFINERS CAN DETERMINE
THE POINT OF DELIVERY OF THE FUEL UPON WHICH THEY BID. HOWEVER, UNDER
THE PRESENT PROCEDURES THE IFB APPRISES ALL BIDDERS OF THE QUANTITY OF
FUEL REQUIRED (SUBJECT, OF COURSE, TO CHANGES IN REQUIREMENTS) AND
UNLIKE THE "FLOATING SET-ASIDE" PROCEDURES COMPLAINED OF IN OUR DECISION
PUBLISHED AT 41 COMP. GEN. 306 (1961), THE BIDDERS ARE INFORMED OF THE
LOCATION AND QUANTITIES OF THE SMALL BUSINESS SET-ASIDES. WHILE IT IS
TRUE THAT UNDER THE PRESENT PROCEDURES BIDDERS HAVE NO WAY OF KNOWING
WHERE THEIR PRODUCTS WILL BE ULTIMATELY LAID DOWN OR ALLOCATED, SINCE
THE MINIMUM COST SOLUTION DETERMINES THE LOWEST LAID DOWN COST FOR FUEL
AT THE VARIOUS LOCATIONS, IT WOULD APPEAR THAT ALL BIDDERS ARE SUBJECT
TO THE SAME UNCERTAINTIES, AND THAT BID EVALUATIONS ARE FAIR AND
EQUITABLE AND DO RESULT IN AWARDS AT THE LOWEST COST TO THE GOVERNMENT.
CONCERNING YOUR CONTENTION THAT DFSC'S EVALUATION PROCEDURES DEFEAT
THE CONGRESSIONAL PURPOSE AND INTENT IN ESTABLISHING THE SMALL BUSINESS
SET-ASIDE PROCEDURE, 15 U.S.C. 631 STATES, IN PERTINENT PART:
" *** IT IS THE DECLARED POLICY OF THE CONGRESS THAT THE GOVERNMENT
SHOULD AID, COUNSEL, ASSIST AND PROTECT, INSOFAR AS IS POSSIBLE, THE
INTERESTS OF SMALL-BUSINESS CONCERNS IN ORDER TO PRESERVE FREE
COMPETITIVE ENTERPRISE, TO INSURE THAT A FAIR PROPORTION OF THE TOTAL
PURCHASES AND CONTRACTS OR SUBCONTRACTS FOR PROPERTY AND SERVICES FOR
THE GOVERNMENT (INCLUDING BUT NOT LIMITED TO CONTRACTS OR SUBCONTRACTS
FOR MAINTENANCE, REPAIR, AND CONSTRUCTION) BE PLACED WITH SMALL-BUSINESS
ENTERPRISES, TO INSURE THAT A FAIR PROPORTION OF THE TOTAL SALES OF
GOVERNMENT PROPERTY BE MADE TO SUCH ENTERPRISES, *** " WE FAIL TO SEE
HOW DFSC'S EVALUATION PROCEDURES WOULD BE CONTRARY TO THE ABOVE STATED
POLICY OF CONGRESS. THE RECORD INDICATES THAT COMPETITION WAS MORE THAN
ADEQUATE FOR THE JP-4 AND JP-5 FUEL PROCUREMENTS. ALSO, WE ARE ADVISED
THAT UNDER PROCUREMENTS FOR BOTH JP-4 AND JP-5 JET FUEL REQUIREMENTS A
SUBSTANTIAL PORTION OF THE PROCUREMENTS WERE SET ASIDE FOR SMALL
BUSINESS (E.G., 35.6 PERCENT OF THE PROCUREMENT UNDER IFB
DSA600-70-B-0061 AND 24 PERCENT UNDER IFB DSA600-70-B-0090, WHICH WOULD
APPEAR TO BE A SUBSTANTIAL PORTION SINCE WE ARE ADVISED THAT SMALL
BUSINESS REFINING CAPACITY IS ONLY ABOUT 7 PERCENT OF THE REFINING
CAPACITY IN THE UNITED STATES).
IN REGARD TO YOUR ALLEGATION THAT THE PRESENT PROCEDURES ARE CONTRARY
TO DFSC'S STATED POLICY THAT "THE PRICE AT WHICH AWARDS SHALL BE MADE TO
SMALL BUSINESS CONCERNS IS DETERMINED WITHOUT REFERENCE TO THE PRICE OR
PRICES AT WHICH AWARDS ARE MADE ON THE NON-SET-ASIDE PORTION", YOU HAVE
FAILED TO SPECIFICALLY IDENTIFY SUCH A POLICY. YOU DO REFER TO A
PORTION OF OUR DECISION WHICH IS PUBLISHED AT 41 COMP. GEN. 306, WHEREIN
WE COMMENT ON A PROCEDURE (WEIGHTED AVERAGE) PROPOSED BY THE MILITARY
PETROLEUM SUPPLY AGENCY (MPSA). HOWEVER, IN OUR COMMENT CONCERNING THE
WEIGHTED AVERAGE PROCEDURE WE STATED THAT UNDER THAT PROCEDURE "THE
PRICE AT WHICH AWARDS SHALL BE MADE TO SMALL BUSINESS CONCERNS IS
DETERMINED WITHOUT REFERENCE TO THE PRICE OR PRICES AT WHICH AWARDS ARE
MADE ON THE NON-SET-ASIDE PORTION". THAT PASSAGE WAS NOT INTENDED AS A
STATEMENT OF POLICY OF THE PROCURING AGENCY. RATHER, IT WAS INTENDED AS
A COMPARISON OF THE "WEIGHTED AVERAGE" APPROACH TO THOSE PROCEDURES
WHEREBY AWARD IS MADE TO SMALL BUSINESS AT A PRICE NOT IN EXCESS OF THE
HIGHEST UNIT PRICE AWARDED UNDER THE NON-SET-ASIDE PORTION. IN VIEW
THEREOF, AND IN THE ABSENCE OF A DEFINITE IDENTIFICATION OF THE POLICY
TO WHICH YOU REFER, WE SEE NO NECESSITY FOR FURTHER DISCUSSION ON THIS
POINT.
FOR THE ABOVE REASONS, AND THE CONCLUSIONS SET OUT IN THE ENCLOSURE,
YOUR PROTEST MUST BE DENIED.
B-171378, APR 28, 1971
BID PROTEST - CHANGE OF SPECIFICATIONS
CONCERNING THE BID PROTEST OF PECK BROTHERS AGAINST THE AWARD OF
CONTRACTS TO SHAUB ELLISEN AND SAM'S TIRE SERVICE UNDER AN IFB ISSUED BY
THE AUBURN, WASHINGTON, REGIONAL OFFICE, GSA FOR RETREADING AND
REPAIRING OF PNEUMATIC TIRES.
PECK'S CHALLENGE TO THESE CONTRACTS WAS BASED ON THE FACT THAT THE
ORIGINAL SPECIFICATIONS WERE CHANGED AFTER OPENING OF BIDS WHEN THE
INADVISABILITY OF HAVING REPAIR AND RETREADING DONE BY DIFFERENT FIRMS
WAS DECIDED UPON. THE AWARDS SHOULD NOT HAVE BEEN MADE. WHERE
SPECIFICATIONS ARE CHANGED AFTER THE BIDS ARE OPENED; THE PROPER
PROCEDURE IS TO REJECT ALL BIDS AND READVERTISE. HOWEVER, BECAUSE OF
THE LAPSE OF TIME AND THE RELATIVE SHORT TIME LEFT BEFORE THE CONTRACTS
EXPIRE, THE AWARD SHOULD NOT BE DISTURBED.
TO MR. KUNZIG:
REFERENCE IS MADE TO A LETTER OF MARCH 1, 1971, WITH ENCLOSURES, FROM
YOUR GENERAL COUNSEL, CONCERNING THE PROTEST OF PECK BROTHERS, (PECK)
AGAINST AN AWARD UNDER SOLICITATION NO. SSPT-0683, ISSUED BY THE GENERAL
SERVICES ADMINISTRATION FOR THE RETREADING AND REPAIRING OF PNEUMATIC
TIRES FOR THE FORT LEWIS-MCCHORD AIR FORCE BASE SERVICE AREA.
THE SOLICITATION WAS ISSUED MARCH 10, 1970, BY THE AUBURN,
WASHINGTON, REGIONAL OFFICE, TO SATISFY THE REQUIREMENTS FOR RETREADING
AND REPAIR OF TIRES AT 52 SERVICE AREAS IN REGION 10 FOR THE PERIOD JUNE
1, 1970, OR DATE OF AWARD, IF LATER, THROUGH MAY 31, 1971. BIDS FOR
RETREADING WERE SOLICITED FOR FOUR SEPARATE GROUPS OF TIRE SIZES. BIDS
FOR REPAIR WERE SOLICITED ON THE BASIS OF A SINGLE QUOTATION FOR EACH
AREA FOR TIRE GROUPS 2, 3, AND 4 COMBINED AS A SINGLE UNIT. OFFERS WERE
TO BE MADE ON THE BASIS OF PERCENTAGE DISCOUNTS FROM PREESTABLISHED
PRICE SCHEDULES FOR EACH GROUP AND SERVICE AREA LISTED IN THE
SOLICITATION. BIDDERS WERE ADVISED ON PAGE 9 OF THE SOLICITATION THAT
"AWARDS WILL BE MADE ON THE BASIS OF THE BEST SINGLE DISCOUNT OFFERED
FROM THE LIST PRICES SHOWN *** FOR EACH GROUP AND EACH SERVICE AREA ***
"
BIDS WERE OPENED AS SCHEDULED ON APRIL 7, 1970. SHAUB-ELLISON
(SHAUB) WAS THE LOW SUCCESSFUL BIDDER AT A 67 PERCENT DISCOUNT FOR
RETREADING OF GROUPS 1, 2, AND 4 IN THE FORT LEWIS-MCCHORD AIR FORCE
BASE SERVICE AREA. THE OFFERS FOR THE RETREADING WORK FOR GROUP 3 WERE
RECEIVED FROM PECK AND SAM'S TIRE SERVICE (SAM'S) AT A 70.5 PERCENT
DISCOUNT. THE TABULATION BELOW, TAKEN FROM THE ABSTRACT OF BIDS,
ILLUSTRATES THE PERCENTAGE DISCOUNTS BY THE BIDDERS UPON WHICH
EVALUATION OF BIDS WAS MADE: