B-124999, NOV. 14, 1955

B-124999: Nov 14, 1955

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TO THE HONORABLE SECRETARY OF THE INTERIOR: REFERENCE IS MADE TO THE ADMINISTRATIVE ASSISTANT SECRETARY'S LETTER OF AUGUST 2. REQUESTING A DECISION AS TO THE PROPRIETY OF EFFECTING REFUND TO THE KROGH PUMP AND EQUIPMENT COMPANY OF $103.80 OF THE SUM OF $122.79 WHICH WAS DEDUCTED IN MAKING PAYMENT TO THE CONTRACTOR FOR SUMP PUMPS FURNISHED UNDER CONTRACT NO. 14-06-D-780. WERE REQUESTED FOR FURNISHING TWO MOTOR DRIVEN SUMP PUMPS FOR THE EKLUTNA PROJECT. BIDDERS WERE GIVEN THE OPTION OF BIDDING F.O.B. THE TOTAL SHIPPING WEIGHTS WERE REQUIRED TO BE SET FORTH IN THE BID FORM AND BIDDERS WERE ADVISED THAT THE INFORMATION WOULD BE USED IN COMPUTING THE DELIVERED COST TO THE GOVERNMENT AND IN DETERMINING THE LOW BID.

B-124999, NOV. 14, 1955

TO THE HONORABLE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO THE ADMINISTRATIVE ASSISTANT SECRETARY'S LETTER OF AUGUST 2, 1955, REQUESTING A DECISION AS TO THE PROPRIETY OF EFFECTING REFUND TO THE KROGH PUMP AND EQUIPMENT COMPANY OF $103.80 OF THE SUM OF $122.79 WHICH WAS DEDUCTED IN MAKING PAYMENT TO THE CONTRACTOR FOR SUMP PUMPS FURNISHED UNDER CONTRACT NO. 14-06-D-780, DATED NOVEMBER 20, 1953.

UNDER BIDDING SCHEDULE NO. 1 OF INVITATION NO. DS-4044, ISSUED BY THE DEPARTMENT OF THE INTERIOR, BUREAU OF RECLAMATION, BIDS, TO BE OPENED OCTOBER 22, 1953, WERE REQUESTED FOR FURNISHING TWO MOTOR DRIVEN SUMP PUMPS FOR THE EKLUTNA PROJECT, ALASKA. BIDDERS WERE GIVEN THE OPTION OF BIDDING F.O.B. CARS AT SEATTLE, WASHINGTON, OR F.O.B. CARS AT THE BIDDER'S SHIPPING POINT. IN THE LATTER CASE, THE FREIGHT CLASSIFICATIONS, THE SHIPPING POINT OR POINTS, AND THE TOTAL SHIPPING WEIGHTS WERE REQUIRED TO BE SET FORTH IN THE BID FORM AND BIDDERS WERE ADVISED THAT THE INFORMATION WOULD BE USED IN COMPUTING THE DELIVERED COST TO THE GOVERNMENT AND IN DETERMINING THE LOW BID. ALSO, IT WAS STATED IN PARAGRAPH B-7 (B) OF THE SPECIAL CONDITIONS OF THE INVITATION THAT WHERE THE ACTUAL TOTAL COST OF TRANSPORTATION ON GOVERNMENT BILLS OF LADING FROM THE SHIPPING POINT TO DESTINATION EXCEEDED THE TOTAL COST OF SUCH TRANSPORTATION COMPUTED ON THE BASIS OF THE TOTAL SHIPPING WEIGHTS, FREIGHT CLASSIFICATIONS, AND SHIPPING POINTS STATED BY THE SUCCESSFUL BIDDER IN HIS BID THE GOVERNMENT WOULD DEDUCT THE EXCESS TRANSPORTATION COSTS FROM ANY PAYMENT DUE THE CONTRACTOR.

THE CONTRACT INVOLVED WAS CONSUMMATED ON THE BASIS OF ACCEPTANCE OF KROGH PUMP AND EQUIPMENT COMPANY'S BID DATED OCTOBER 19, 1953, WHICH STIPULATED A TOTAL PRICE OF $2,152 FOR THE TWO PUMPING UNITS ON THE BASIS OF SHIPPING POINT DELIVERIES F.O.B. RAILROAD CARS AT LOS ANGELES AND SAN JOSE, CALIFORNIA, FOR THE PUMPS AND THE ACCOMPANYING MOTORS, RESPECTIVELY. THE SHIPPING WEIGHTS OF THE PUMPS AND MOTORS WERE SHOWN ON PAGE "B" OF THE BIDDING SCHEDULE TO BE 2,000 POUNDS AND 320 POUNDS, RESPECTIVELY. THE CONTRACTING OFFICER, IN AWARDING THE CONTRACT TO KROGH, EVALUATED ITS BID ON THE BASIS OF TRANSPORTATION COSTS COMPUTED ON THE SHIPPING WEIGHTS STATED, AGGREGATING 2,320 POUNDS.

SUBSEQUENTLY, IT WAS DISCOVERED THAT THE EQUIPMENT HAD AN AGGREGATE SHIPPING WEIGHT IN EXCESS OF 4,640 POUNDS, AND THE AMOUNT OF $122.79 WAS DEDUCTED IN MAKING PAYMENT FOR THE EQUIPMENT UNDER THE CONTRACT TO COMPENSATE THE GOVERNMENT FOR THE ADDITIONAL FREIGHT COSTS REQUIRED TO BE PAID ON THE SHIPMENT OVER AND ABOVE WHAT THEY WOULD HAVE BEEN IF THE WEIGHT HAD BEEN 2,320 POUNDS, THE GUARANTEED WEIGHT STATED IN SCHEDULE 1 OF THE BID. BY LETTER OF MAY 21, 1954, TO THE BUREAU OF RECLAMATION, THE CONTRACTOR PROTESTED THIS ACTION AS FOLLOWS:

"OUR QUOTATION AND THE PERFORMANCE OF OUR CONTRACT WAS BASED ON FURNISHING TWO PUMPING UNITS FOB, LOS ANGELES, CALIFORNIA, WITH FREIGHT ALLOWED TO SEATTLE, WASHINGTON, WHICH ACCORDING TO OUR RECORDS WAS ACCOMPLISHED.

"WE NOTE THAT YOUR SUBJECT VOUCHER INDICATES A GUARANTEED SHIPPING WEIGHT OF 2320 LBS. BY REFERRING TO PAGE H OF THE INVITATION AND THE EACH PUMPING UNIT AND DOES NOT REFLECT THE TOTAL SHIPPING WEIGHT WHICH, OF COURSE, WOULD BE 4640 LBS. NET TOTAL, PLUS A SMALL AMOUNT FOR BOXING AND CRATING.

"BASED ON THE ABOVE, WHICH WE HOPE YOUR RECORDS WILL VERIFY, WE SHALL BE PLEASED TO RECEIVE YOUR FURTHER REMITTANCE OF $122.79 AT YOUR CONVENIENCE.'

IN THE LETTER OF JULY 18, 1955, FROM THE ASSISTANT COMMISSIONER AND THE CHIEF ENGINEER OF THE BUREAU OF RECLAMATION TO THE COMMISSIONER OF RECLAMATION, THE CHIEF ENGINEER, WHO EXECUTED THE CONTRACT ON BEHALF OF THE GOVERNMENT, STATES THAT HE OVERLOOKED THE DISCREPANCY BETWEEN THE TOTAL SHIPPING WEIGHT FOR THE EQUIPMENT AS STATED ON PAGE "B" OF THE SCHEDULE AND THE INFORMATION WITH RESPECT TO WEIGHT SHOWN ON PAGE "H" THEREOF, REFERRED TO IN THE CONTRACTOR'S LETTER. THE CHIEF ENGINEER STATES THAT, IF HE HAD METICULOUSLY ANALYZED THE BID, HE WOULD HAVE BEEN AWARE THAT AN ERROR HAD BEEN MADE BY THE CONTRACTOR IN STATING THE SHIPPING WEIGHT. THE COGNIZANT OFFICIALS RECOMMEND THAT $103.80 OF THE AMOUNT DEDUCTED BE PAID TO THE CONTRACTOR ON THE BASIS THAT IT WAS THE CONTRACTOR'S INTENTION TO QUOTE A GUARANTEED SHIPPING WEIGHT OF 4,640 POUNDS FOR THE TWO UNITS. THE CHIEF ENGINEER DOES NOT RECOMMEND PAYMENT OF THE BALANCE OF THE AMOUNT DEDUCTED, OR $18.99, FOR THE STATED REASON THAT THIS REPRESENTS THE EXTRA FREIGHT ATTRIBUTABLE TO THE TARE WEIGHT, AND THAT HE WAS NOT ON NOTICE OF ANY SPECIFIC TARE WEIGHT WHICH WAS INTENDED TO BE BID.

SINCE THE INFORMATION SET OUT ON PAGE "H" OF THE BIDDING SCHEDULE SHOWS THE AGGREGATE WEIGHT OF THE EQUIPMENT FURNISHED UNDER THE CONTRACT TO BE 4,640 POUNDS, OR 2,320 POUNDS FOR EACH OF THE TWO UNITS, THE CONTRACTING OFFICER PROPERLY WAS CHARGEABLE WITH NOTICE THAT A MISTAKE HAD BEEN MADE WITH RESPECT TO THE STATEMENT OF THE SHIPPING WEIGHT IN PARAGRAPH "B," AND THAT THE WEIGHTS THERE STATED WERE FOR SINGLE UNITS AND NOT FOR THE TOTAL CONTRACT QUANTITY. THE ABSTRACT OF BIDS SHOWS THAT, IF KROGH'S BID IS COMPUTED UPON THE BASIS OF THE CORRECT SHIPPING WEIGHT, IT STILL REPRESENTS THE LOWEST QUALIFIED BID RECEIVED FOR FURNISHING THE EQUIPMENT.

IN THE CIRCUMSTANCES, WE WILL ENTERTAIN NO OBJECTION TO PAYMENT TO THE CONTRACTOR OF THE SUM OF $103.80, AS RECOMMENDED IN YOUR LETTER. HOWEVER, PAYMENT OF THE BALANCE OF THE AMOUNT DEDUCTED, REPRESENTING TARE WEIGHT, WOULD NOT BE AUTHORIZED FOR THE REASONS STATED BY THE CHIEF ENGINEER.