The Williams Brothers Corporation of America, B-293352, February 26, 2004 * REDACTED DECISION

B-293352: Feb 26, 2004

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Protest that agency improperly waived solicitation requirement that offers include a conditional commitment of financing for construction of a building to be leased is denied where record shows that neither protester's nor awardee's offer included commitments that satisfied the solicitation requirements. Protest that agency improperly changed two solicitation requirements in awarding lease is denied. Where protester does not allege or show that it was competitively prejudiced by the agency's actions. Offerors were advised that the agency would make award to the firm submitting the lowest-priced offer conforming to the requirements of the SFO. Williams asserts that the letter submitted by Drew was inadequate because it states that it was prepared based on the parties' preliminary discussions to facilitate an extension of credit.

The Williams Brothers Corporation of America, B-293352, February 26, 2004 * REDACTED DECISION

DIGEST

Attorneys

DECISION

The Williams Brothers Corporation of America protests the award of a lease to H.H. Drew, LLC under General Services Administration (GSA) solicitation for offers (SFO) No. 3VA0054, for a facility to be occupied by the Bureau of Alcohol, Tobacco and Firearms in Front Royal, Virginia. Williams maintains that Drew's offer did not include required evidence of a conditional commitment of funds, and that the agency improperly modified two material terms of the SFO in the awarded lease.

We deny the protest.

The SFO contemplated the award of a lease for approximately 25,000 rentable square feet for a base period of 10 years, with two 5-year options. Offerors were advised that the agency would make award to the firm submitting the lowest-priced offer conforming to the requirements of the SFO. The agency received two offers and made award to Drew as the firm submitting the lowest-priced conforming offer.

Williams maintains that one aspect of Drew's offer did not conform to the requirements of the SFO. Specifically, the SFO required offerors to submit with their proposals satisfactory evidence of at least a conditional commitment of funds in an amount necessary to prepare the leased space for occupancy; the conditional commitment had to be signed by an authorized bank officer and state, at a minimum, the
amount of the loan, its term in years, the annual interest rate, and
the length of the loan commitment. SFO at 14. Williams asserts that
the letter submitted by Drew was inadequate because it states that it
was prepared based on the parties' preliminary discussions to
facilitate an extension of credit, and then states as follows: "This
letter is not a promise, commitment or an agreement to lend money to,
provide financing for, or grant or extend credit to Applicant and may
not be relied upon by you [the applicant] or any third party as such."
Agency Report (AR), exh. 6, at 1. The protester maintains that, by
its terms, the letter submitted by Drew is inadequate because it
expressly does not make a commitment of any sort.

The agency's acceptance of Drew's letter was unobjectionable because,
while we agree that the letter did not satisfy the SFO requirements,
the record shows that Williams' own conditional commitment letter was
at least as deficient. In this regard, Williams' letter, in its
entirety, provides only as follows regarding the conditional
commitment:

I enjoyed the discussion relating to your project with the Bureau of
Alcohol, Tobacco and Firearms Rental Building. [deleted], as always,
is very interested in your projects and we would like the opportunity
to be involved in the financing of your project.

We would like to pursue the details of your project once you have
secured the deal with ATF. Once we receive the completed package we
will be able to review and discuss a detailed plan of action. Upon
final approval, we would issue a commitment based upon the project
needs and our ability to meet those needs.

AR, exh. 4, at 110. Thus, like Drew's letter, Williams' letter in no
way expresses a conditional commitment to provide funds; rather, it
merely provides that a commitment may be issued in the future, after
award. Unlike Drew's letter, moreover, Williams' letter did not
include any of the required details--such as the amount or purpose of
the loan, its term in years or the interest rate. We conclude that,
to the extent the agency waived the conditional commitment requirement
for Drew, it also waived the requirement for the protester. Under
these circumstances, there is no basis for us to find that Williams
was competitively prejudiced by the agency's actions; this argument
thus provides no basis for sustaining the protest. See Food Servs.,
Inc., B-243173, B-243173.2, July 10, 1991, 91-2 CPD Para. 39 at 6 n.2;
Mediq Equip. & Maint. Servs., Inc., B-242222, Mar. 26, 1991, 91-1 CPD
Para. 328 at 3. Williams also alleges that the agency improperly
changed two aspects of the requirement in the awarded lease as
compared to the terms of the SFO--first, while the SFO called for the
award of a 10-year lease with two 5-year options, the lease as awarded
is for only 10 years, with no options, and second, while the SFO
called for occupancy no later than May 2004, the lease as awarded
calls for occupancy 180 days after approval of the tenant improvement
drawings.

As with the conditional commitment of funds issue, we have no basis
for finding prejudice to the protester based on the change in the
lease term. A firm's yearly price typically would be expected to
increase, rather than decrease, where a shorter lease term is imposed,
since costs associated with preparation of the leased space for
occupancy, for example, would have to be amortized over a shorter
period of time. Williams does not argue that it would have lowered its
price in response to the changed lease term. Under these
circumstances, we have no basis for finding prejudice.

As for the occupancy date, the change appears to be largely form over
substance. The lease provides for a maximum of approximately 60 days
for preparation and approval of the tenant improvement drawings, AR,
exh. 13, at 19, so, including the 180-day period specified for
construction of the tenant improvements, the premises must be ready
for occupancy 240 days after award. Given that the lease was awarded
on September 25, 2003, the occupancy date in the awarded lease remains
sometime during May 2004, as specified in the SFO. In any case, as
with the other deficiencies discussed above, Williams neither argues
nor demonstrates that it would have changed its offer based on the
alleged change in the occupancy date.

The protest is denied.

Anthony H. Gamboa
General Counsel

* DOCUMENT FOR PUBLIC RELEASE

The decision issued on the date below was subject to a GAO Protective
Order. This redacted version has been approved for public release.

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