B-127273, MAR. 21, 1956

B-127273, MAR. 21, 1956

TO MR. L. N. MCCLELLAN, CONTRACTING OFFICER, BUREAU OF RECLAMATION:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 9, 1956, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING A BID DATED FEBRUARY 23, 1956, SUBMITTED BY WEST COAST CONSTRUCTION COMPANY, INC., IN VIEW OF THE BIDDER'S ALLEGATION OF ERROR.

IN RESPONSE TO INVITATION FOR BIDS ISSUED BY THE BUREAU OF RECLAMATION FOR FURNISHING 67 ITEMS OF WORK ON THE ROYAL BRANCH CANAL AND WASTEWAY, CRAB CREEK LATERAL AND THE EXTENSION THEREOF, REFERRED TO AS THE COLUMBIA BASIN PROJECT, WASHINGTON, THE CORPORATION SUBMITTED A BID ON ALL ITEMS AGGREGATING $459,297.05. AFTER THE OPENING THE CORPORATION, BY LETTER DATED MARCH 6, 1956, ADVISED THAT A SERIOUS MATHEMATICAL ERROR HAD BEEN MADE IN ITS BID RESULTING IN THE AMOUNT THEREOF BEING $25,050 LESS THAN WAS INTENDED. IT EXPLAINED THAT WHILE THE BID WAS SUBMITTED IN ITS NAME SOLELY, ACTUALLY IT REPRESENTED A JOINT VENTURE OF TWO CORPORATIONS INCLUDING GOODFELLOW BROTHERS, INC. THE LATTER CORPORATION IT SEEMS WAS CONCERNED CHIEFLY WITH THE EARTHWORK INVOLVED, WHICH, AS DISCLOSED IN PARAGRAPH 13, PAGE 3 OF THE SPECIFICATIONS, WAS A SUBSTANTIAL PORTION OF THE PROJECT. IT IS STATED THAT THE TWO CORPORATIONS HAD BEEN OPERATING JOINTLY IN THE SAME MANNER WITH RESPECT TO OTHER GOVERNMENT CONTRACTS IN THE AREA, BUT THAT FOR APPROXIMATELY A YEAR THEY HAD BEEN UNSUCCESSFUL BIDDERS AND, THEREFORE, IT WAS DECIDED TO MAKE MANY ADJUSTMENTS SUCH AS RESHUFFLING AND REDUCING QUOTATIONS IN ITS ORIGINALLY PREPARED ESTIMATE ON THE VARIOUS ITEMS, PARTICULARLY THOSE COVERING THE EARTHWORK, IN ORDER THAT THE BID WOULD BE AS LOW AS POSSIBLE IN THE COMPETITION FOR THE INSTANT PROJECT AWARD. TO DO THIS THEY DECIDED THAT BY EXPEDITING THE EXCAVATION WORK THROUGH EMPLOYMENT OF DOUBLE SHIFTS AND ADDITIONAL EQUIPMENT MUCH OF IT COULD BE ACCOMPLISHED EARLY IN THE SPRING WHILE CONSIDERABLE MOISTURE WAS STILL RETAINED IN THE GROUND AND THEREBY THEY COULD CUT DOWN SUBSTANTIALLY THEIR ORIGINAL QUOTATIONS OF $4 AND $3 PER 1,000 GALLONS OF WATER ON THE ESTIMATED QUANTITIES THEREOF UNDER ITEMS NOS. 10 AND 11, RESPECTIVELY. IT IS CLAIMED THAT WITH THIS IN VIEW THE ESTIMATES ON ITEMS NOS. 10 AND 11 WERE REDUCED TO THE NOMINAL AMOUNT OF $0.05 PER 1,000 GALLONS ON BOTH ITEMS WITH THE ALLEGED INTENTION, HOWEVER, OF INCREASING THE ESTIMATE ON ITEM NO. 1 BY $0.05 PER CUBIC YARD AND THE ESTIMATE ON ITEM NO. 4 BY $0.04 PER CUBIC YARD. PURSUANT TO THIS PLAN THE INTENDED REDUCTIONS ON THE SEVERAL ITEMS WERE ACCOMPLISHED, AS CHANGES ON THE WORKSHEET SHOW AND THE BID DULY REFLECTS. HOWEVER, THE REFERRED-TO INTENDED INCREASES ON ITEMS NOS. 1 AND 4 WERE INADVERTENTLY OVERLOOKED AND NOT INCLUDED IN THE BID AS THE WORKSHEET AND THE BID DISCLOSE. SUBSTANTIATION OF ITS ALLEGED ERROR AND THE INTENDED BID, THE BIDDER HAS FORWARDED THE SWORN STATEMENTS OF THE PRESIDENTS OF THE INVOLVED CORPORATIONS AND THE WORKSHEETS OF BOTH CORPORATIONS WHICH REASONABLY SUPPORT THE ALLEGATION OF ERROR AND ESTABLISH THAT THE INTENTION OF THE PARTIES AS TO THE ADJUSTMENTS OF THE BID PRICES ON ITEMS NOS. 10 AND 11 AND NOS. 1 AND 4 WAS AS ALLEGED.

THE ABSTRACT OF BIDS SHOWS THAT THE FOUR OTHER BIDS RECEIVED WERE $551,552.85, $570,106, $575,380 AND $583,745.35 AND YOU STATE THAT THE GOVERNMENT'S ESTIMATE OF THE COST OF THE WORK WAS $486,157. THUS, THE CORPORATION'S BID OF $459,297.05 WAS ENTIRELY OUT OF LINE WITH THE OTHER BIDS AND CONSIDERABLY LESS THAN THE GOVERNMENT ESTIMATE. IN VIEW OF ALL THE FACTS INVOLVED, PARTICULARLY THE SUBSTANTIAL VARIANCE BETWEEN THE CORPORATION'S BID AND THE OTHERS RECEIVED, THERE WOULD APPEAR TO BE LITTLE DOUBT THAT A BONA FIDE ERROR WAS MADE IN THE BID OF WEST COAST CONSTRUCTION COMPANY, INC., AND THAT IF NOT FOR THE ERROR THE BID WOULD HAVE BEEN $25,050 HIGHER THAN THE BID AS SUBMITTED.

ACCORDINGLY, SINCE THE ERROR WAS ALLEGED AND EVIDENCE HAS BEEN FURNISHED REASONABLY ESTABLISHING, PRIOR TO AWARD, THE ERROR AND THE INTENDED BID, THE BID MAY BE CORRECTED TO PROVIDE FOR THE REQUESTED INCREASES ON ITEMS NOS. 1 AND 4 WHICH WILL INCREASE THE AGGREGATE BID BY $25,050, FROM $459,297.05 TO $484,347.05, AND THE BID, AS CORRECTED, MAY BE CONSIDERED ALONG WITH THE OTHER BIDS IN MAKING THE AWARD.

IN THE EVENT OF AN AWARD TO THE WEST COAST CONSTRUCTION COMPANY, INC., A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE CONTRACT.

THE LETTERS AND WORKSHEETS FROM THE TWO CORPORATIONS ARE RETAINED IN OUR FILES. ALL THE OTHER PAPERS FORWARDED WITH YOUR LETTER OF MARCH 9, 1956, ARE RETURNED.