B-124573, SEP. 21, 1955

B-124573, SEP. 21, 1955

TO BEACON CONSTRUCTION COMPANY:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JULY 6, 1955, AND SUBSEQUENT CORRESPONDENCE, PROTESTING THE AWARD MADE BY THE DEPARTMENT OF THE AIR FORCE TO WILLIAM B. ROUSE COMPANY UNDER INVITATION FOR BIDS NO. 30-603-55- 38, ISSUED BY STEWART AIR FORCE BASE, NEWBURGH, NEW YORK.

THE INVITATION REQUESTED BIDS FOR THE CONSTRUCTION OF A TOTAL OF 209 HOUSES AT 23 DIFFERENT SITES IN NORTHEASTERN UNITED STATES; FOR RELATED CONSTRUCTION OF ROADS, SIDEWALKS, UTILITY LINES, AND THE LIKE; AND FOR THE FURNISHING OF BASIC KITCHEN EQUIPMENT. A BID BOND IN THE AMOUNT OF 20 PERCENT OF THE BID PRICE WAS REQUIRED TO BE SUBMITTED WITH ANY BID. SEPARATE SCHEDULES WERE PROVIDED FOR QUOTING ON THE 23 DIFFERENT SITES. ALL 23 SCHEDULES, EXCEPT SCHEDULE C-22, PROVIDED FOR BIDS ON (1) GENERAL SITE WORK, (2) TWO-BEDROOM HOUSES, (3) THREE BEDROOM HOUSES, (4) UNIT PRICES FOR CERTAIN WORK FOR THE PURPOSE OF COMPUTING EXTRA WORK OR CREDITS AND (5) KITCHEN EQUIPMENT. SCHEDULE C 22 PROVIDED, AS AN ADDITIONAL ITEM, THE CONSTRUCTION OF A WELL.

WITH RESPECT TO AWARD, PARAGRAPHS 11, 12, 14, 15, 16, AND 17 PROVIDED, AS FOLLOWS:

"11. AWARD OF CONTRACT. (A) THE CONTRACT WILL BE AWARDED AS SOON AS PRACTICABLE TO THE LOWEST RESPONSIBLE BIDDER, PRICE AND OTHER FACTORS CONSIDERED, PROVIDED HIS BID IS REASONABLE AND IT IS TO THE INTEREST OF THE GOVERNMENT TO ACCEPT IT.

"/B) THE GOVERNMENT RESERVES THE RIGHT TO WAIVE ANY INFORMALITY IN BIDS RECEIVED WHEN SUCH WAIVER IS IN THE INTEREST OF THE GOVERNMENT. IN CASE OF ERROR IN THE EXTENSION OF PRICES, THE UNIT PRICE WILL GOVERN.

"/C) THE GOVERNMENT FURTHER RESERVES THE RIGHT TO ACCEPT OR REJECT ANY OR ALL ITEMS OF ANY BID, UNLESS THE BIDDER QUALIFIES SUCH BID BY SPECIFIC LIMITATION; ALSO TO MAKE AN AWARD TO THE BIDDER WHOSE AGGREGATE BID ON ANY COMBINATION OF BID ITEMS IS LOW.

"12. REJECTION OF BIDS. THE GOVERNMENT RESERVES THE RIGHT TO REJECT ANY AND ALL BIDS WHEN SUCH REJECTION IS IN THE INTEREST OF THE GOVERNMENT; TO REJECT THE BID OF A BIDDER WHO HAS PREVIOUSLY FAILED TO PERFORM PROPERLY OR COMPLETE ON TIME CONTRACTS OF A SIMILAR NATURE; AND TO REJECT THE BID OF A BIDDER WHO IS NOT, IN THE OPINION OF THE CONTRACTING OFFICER, IN A POSITION TO PERFORM THE CONTRACT.

"14. SEPARATE PRICES: SEPARATE PRICES ARE REQUESTED FOR SEVERAL ITEMS OF WORK AT EACH SITE. HOWEVER, THESE PRICES WILL NOT BE USED FOR PURPOSES OF DIVIDING THE WORK. ALL THE WORK AT ONE PROJECT SITE WILL BE AWARDED TO ONE CONTRACTOR.

"15. BIDS ON SEVERAL SITES: BIDDERS MAY BID ON WORK AT ONE OR MORE SITES AS THEY DESIRE. SEPARATE PRICES MUST BE QUOTED FOR EACH PROJECT SITE. AVOID VIOLATION OF ARTICLE 10 OF THESE INSTRUCTIONS, ALL BIDS OFFERED BY THE SAME BIDDER SHOULD BE IN THE SAME ENVELOPE CLEARLY AND SIMILARLY MARKED TO IDENTIFY THE BIDDER.

"16. QUALIFICATION OF BIDS: BIDDERS WHO BID WORK ON SEVERAL SITES MAY QUALIFY THEIR BIDS TO PREVENT DIVISION BY SITES BY STATING ON THE BID SHEET THAT THEY WILL NOT ACCEPT AN AWARD OTHER THAN AN AWARD OF ALL WORK INCLUDED IN THE BID. IF THE BID IS QUALIFIED IN THIS MANNER THE BIDDER MAY SUBMIT SEPARATE BIDS FOR WORK AT SINGLE SITES WITHOUT QUALIFICATION.

"17. TOTAL AWARD: THE GOVERNMENT RESERVES THE RIGHT TO AWARD WORK ON ALL SITES IN SUCH MANNER THAT THE TOTAL OF AWARDS IS IN THE BEST INTERESTS OF THE GOVERNMENT.'

A REPORT FURNISHED BY THE DEPARTMENT OF THE AIR FORCE SHOWS THAT 22 BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. THE WILLIAM B. ROUSE COMPANY SUBMITTED AN ALL-OR-NONE BID FOR THE ENTIRE 23 SITES AND SUBMITTED A SEPARATE BID ON ONE SITE. YOUR COMPANY SUBMITTED AN ALL-OR NONE BID ON 13 SITES. THE W. B. GIBSON COMPANY SUBMITTED AN ALL-OR NONE BID ON 9 SITES. THE OTHER BIDDERS SUBMITTED INDIVIDUAL BIDS ON ONE OR MORE SITES.

THE RECORD SHOWS THAT SIX OF THE BIDDERS SUBMITTED BIDS WHICH WERE NONRESPONSIVE TO THE INVITATION TO A DEGREE WHICH PRECLUDED WAIVER, NAMELY, RANVALL CONSTRUCTION COMPANY, VICTOR R. BEAUCHAMP INCORPORATED, RATHBUN COMPANY, PERRY A. BROWN CONSTRUCTION COMPANY, INC., SPENCER WHEELER INCORPORATED, AND NORTHERN BUILDERS.

THE BEACON AND GIBSON ALL-OR-NONE BIDS INCLUDED PRICES ON THE INDIVIDUAL SCHEDULES. HOWEVER, ROUSE'S BID INCLUDED ONLY A LUMP-SUM FOR EACH ITEM OF WORK AT THE 23 SITES. ALSO, ROUSE'S BID WAS NOT ACCOMPANIED BY THE REQUIRED BID BOND.

ALTHOUGH YOU ORIGINALLY PROTESTED THE AWARD TO ROUSE ON THE BASIS THAT HIS BID WAS NOT THE LOW AGGREGATE BID UPON A PROPER EVALUATION OF USABLE FLOOR AREAS, IT IS UNDERSTOOD THAT IN CONFERENCES WITH OUR REPRESENTATIVES YOU NOW CONCEDE THAT ROUSE'S BID IS LOWER THAN THE AGGREGATE AMOUNT OF ANY COMBINATION OF LOW ACCEPTABLE BIDS ON INDIVIDUAL SITES.

YOUR PROTEST AGAINST THE AWARD IS NOW MAINLY ON THE BASIS (1) THAT THE ROUSE BID WAS NOT ACCOMPANIED BY A BID BOND AS REQUIRED, (2) THE ROUSE BID FAILED TO SET FORTH SEPARATE PRICES FOR EACH PROJECT AND SEPARATE PRICES FOR THE SEVERAL ITEMS OF WORK AT EACH PROJECT, AND (3) THAT ONE OF THE BEDROOMS OF THE 3-BEDROOM HOUSE WHICH ROUSE PROPOSED TO FURNISH DOES NOT MEET THE 100 SQUARE FOOT MINIMUM AREA REQUIRED FOR BEDROOMS AS PROVIDED FOR IN PARAGRAPH 1-06D OF THE SPECIFICATIONS.

AS TO THE FIRST ISSUE, IT HAS BEEN CONSISTENTLY HELD THAT GOVERNMENT CONTRACTING OFFICERS MAY WAIVE AS AN INFORMALITY THE FAILURE TO FURNISH A BID BOND PROVIDED THE DEFICIENCY IS PROMPTLY CORRECTED AND THE FAILURE TO FURNISH THE BOND WAS NOT DUE TO THE BIDDER'S INABILITY TO OBTAIN THE BOND BECAUSE OF ITS FINANCIAL STATUS OR SOME SIMILAR REASON. SEE 31 COMP. GEN. 20; 26 ID. 49; 16 ID. 493; ID. 809. ALSO SEE ADELHARDT CONSTRUCTION CO. V. UNITED STATES, 123 C.CLS. 456. SINCE THE BID BOND REQUIRED IN THIS INSTANCE WAS SUPPLIED BY ROUSE WITHIN THE TIME ALLOTED BY THE DEPARTMENT OF THE AIR FORCE AND IT DOES NOT APPEAR THAT THE FAILURE TO FURNISH THE BOND WAS DUE TO ROUSE'S INABILITY TO OBTAIN IT, WE WOULD NOT BE LEGALLY JUSTIFIED IN OBJECTING TO THE ADMINISTRATIVE WAIVER IN THAT REGARD.

THE ROUSE BID AS SUBMITTED COVERED THE PERFORMING OF ALL WORK AT ALL SITES WITH A POSSIBLE EXCEPTION OF THE WELL AT THE PROJECT AT EMPIRE, MICHIGAN. ALTHOUGH A PRICE BREAKDOWN FOR EACH SITE MIGHT HAVE BEEN DESIRED FOR ADMINISTRATIVE PURPOSES, IT WAS NOT OF ANY SIGNIFICANCE IN DETERMINING THE LOW BIDDER. SINCE ROUSE'S BID WAS ON AN ALL-OR-NONE BASIS, EVEN IF SEPARATE PRICES HAD BEEN FURNISHED, THE TOTAL AMOUNT ONLY COULD HAVE BEEN USED FOR EVALUATION PURPOSES. THEREFORE, IT IS NOT PERCEIVED HOW THE FAILURE TO FURNISH SEPARATE PRICES FOR EACH SITE GAVE ROUSE ANY ADVANTAGE OVER OTHER BIDDERS.

AS STATED ABOVE, THE ROUSE BID QUOTED PRICES ON (1) SITE WORK, (2) 2- BEDROOM HOUSES, (3) 3-BEDROOM HOUSES, (4) UNIT PRICES FOR MAKING ADJUSTMENTS FOR EXTRA WORK OR CREDITS AND (5) CERTAIN KITCHEN EQUIPMENT. ON THE PROJECT AT EMPIRE, MICHIGAN, THERE WAS INCLUDED IN THAT BID SCHEDULE (SCHEDULE C-22) A SEPARATE ITEM COVERING THE CONSTRUCTION OF A WELL BUT THE ROUSE BID DID NOT INCLUDE A SPECIFIC PRICE FOR THIS LATTER ITEM OR ANY OF THE OTHER ITEMS ON THE PROJECT AT EMPIRE, MICHIGAN. THE FACT REMAINS, HOWEVER, THAT ROUSE OFFERED TO PERFORM ALL SITE WORK AT ALL LOCATIONS FOR THE AMOUNT OF $1,100,550. IT WAS ADMINISTRATIVELY CONSIDERED THAT THE ROUSE BID THEREFORE INCLUDED THE COST OF THE WELL IN THE SITE WORK, AND, UNDER THE BID SUBMITTED BY ROUSE, IT IS BELIEVED THAT HE WOULD HAVE BEEN LEGALLY LIABLE TO CONSTRUCT THE WELL AT EMPIRE, MICHIGAN, AS A PART OF THE SITE WORK EVEN THOUGH HE SUBSEQUENTLY HAD NOT EXPRESSLY AGREED TO DO SO.

WITH RESPECT TO THE SIZE OF THE BEDROOM, THE ADMINISTRATIVE OFFICE COMPUTES THE SIZE OF THE ROOM AS 8.58 FEET BY 11.67 FEET, MAKING A TOTAL AREA OF 100.13 SQUARE FEET, WHEREAS YOU COMPUTE THE AREA AS 8.50 FEET BY 11.58 FEET, MAKING A TOTAL OF 98.43 SQUARE FEET. IT IS REPORTED THAT THE DIFFERENCE IN THE COMPUTATIONS IS THE RESULT OF ASSUMPTIONS OF THE PRECISE THICKNESS OF THE WALLS; THAT COMPUTATION OF THE EXACT WALL THICKNESS IS NOT POSSIBLE FROM THE TYPE OF DRAWINGS SUBMITTED BY THE BIDDERS WITH THE RESULT THAT SOME ASSUMPTION IS NECESSARY; AND THAT THE ASSUMPTION ADOPTED BY THE GOVERNMENT'S ARCHITECT-ENGINEER IS THAT COMMONLY EMPLOYED BY FHA FIELD OFFICES FOR AREA COMPUTATIONS. THE DIFFERENCE IN COMPUTATIONS APPEARS TO BE RELATIVELY INFINITESIMAL AND BOTH ARE BASED UPON CERTAIN ASSUMPTIONS. THEREFORE, WE WOULD NOT BE JUSTIFIED IN OBJECTING TO THE ADMINISTRATIVE DETERMINATION THAT ROUSE'S BID MEETS THE REQUIREMENTS OF THE SPECIFICATIONS.

WE HAVE EXAMINED THE RECORD FURNISHED BY THE DEPARTMENT OF THE AIR FORCE AND HAVE LIKEWISE CAREFULLY CONSIDERED THE ALLEGATIONS MADE BY YOU. FIND NO SUFFICIENT LEGAL BASIS, HOWEVER, FOR OBJECTING TO THE ADMINISTRATIVE ACTION TAKEN IN THIS MATTER.