B-128465, JUL. 9, 1956

B-128465, JUL. 9, 1956

TO HONORABLE THOMAS J. HERBERT, CHAIRMAN, SUBVERSIVE ACTIVITIES CONTROL BOARD:

YOUR LETTER OF JUNE 28, 1956, FORWARDS A COPY OF AN INVITATION ISSUED MAY 28, FOR BIDS TO FURNISH STENOGRAPHIC REPORTING SERVICES TO YOUR BOARD FOR THE FISCAL YEAR 1957, TOGETHER WITH A LETTER OF PROTEST IN CONNECTION WITH THE BIDDING FROM ONE OF THE BIDDERS.

THE ITEMS IN THE INVITATION ARE DIVIDED INTO 2 MAJOR CATEGORIES: SCHEDULE A FOR SUPPLYING FIRST AND ADDITIONAL COPIES TO THE BOARD, AND SCHEDULE B FOR SUPPLYING FIRST AND ADDITIONAL COPIES TO THE GENERAL PUBLIC AND THE GOVERNMENT (EXCEPT THE BOARD). TWO OF THE BIDDERS, THE ALDERSON REPORTING COMPANY AND THE FRANK J. MCCABE REPORTING COMPANY, OFFERED IN THEIR BIDS TO FURNISH FREE FIRST AND ADDITIONAL COPIES REQUIRED BY THE BOARD. MAXIMUM PRICES BID BY THE TWO COMPANIES FOR SCHEDULE B ARE AS FOLLOWS:

SCHEDULE.

SCHEDULE B. ALDERSON MCCABE

WASHINGTON, D.C.

ITEM 1 ORDINARY COPY .20 .50

ITEM 2 DAILY COPY .85 .85

ITEM 3 ADD. ORDINARY .20 .30

ITEM 4 ADD. DAILY .85 .45

TOTAL 2.10 2.10

CONTINENTAL U.S. (EXCEPT WASH.)

ITEM 1 ORDINARY COPY .35 .60

ITEM 2 DAILY COPY .95 1.00

ITEM 3 ADD. ORDINARY .35 .30

ITEM 4 ADD. DAILY .95 .40

TOTAL 2.60 2.30

THE CONTRACT WAS AWARDED TO ALDERSON ON THE BASIS THAT (1) THE ALDERSON BID FOR FIRST COPIES IS LOWER FOR THE GENERAL PUBLIC AND THE GOVERNMENT (EXCEPT THE BOARD), AND (2) THE RESPONDENT IN A HEARING BEFORE THE BOARD WOULD BE ABLE TO OBTAIN A RECORD AT A FAR LOWER PRICE UNDER THE ALDERSON BID THAN UNDER THE MCCABE BID AND, THEREFORE, AWARD TO ALDERSON WOULD REMOVE ANY POSSIBILITY OF CRITICISM BY RESPONDENTS THAT THE BOARD'S STENOGRAPHIC SERVICES ARE PROHIBITIVELY HIGH AND TEND TO INTERFERE WITH THE REQUIREMENTS OF DUE PROCESS.

THE MCCABE COMPANY PROTESTED THE AWARD ON THE BASIS THAT THE "AGGREGATE" RATE (I.E., THE SUM OF THE RATES) OF THE MCCABE COMPANY IS LOWER THAN THAT OF THE ALDERSON COMPANY, AND FURTHER, THAT THE DEPARTMENT OF JUSTICE WOULD RECEIVE A MORE ADVANTAGEOUS PRICE UNDER THE MCCABE BID IF IT PURCHASED ITS NORMAL REQUIREMENTS OF TWO OR MORE DAILY COPIES.

PARAGRAPH 3 OF THE INVITATION PROVIDES THAT "AWARD OF THE BID WILL BE MADE ON THE AGGREGATE AND NOT ITEM BY ITEM.' PARAGRAPH 3 FURTHER PROVIDES THAT:

"IN THE EVENT THE BIDDER ELECTS TO FURNISH THE BOARD THE WORK FREE OR IN THE EVENT OF "TIE D," THE CONTRACT WILL BE AWARDED TO THE BIDDER OFFERING THE LOWEST PRICE FOR SALE OF COPIES TO THE GOVERNMENT (EXCLUDING THE BOARD) AND TO THE PUBLIC.'

YOUR LETTER INDICATES THAT THE SENTENCE "AWARD OF THE BID WILL BE MADE ON THE AGGREGATE AND NOT ITEM BY ITEM" HAS BEEN PART OF EVERY INVITATION FOR REPORTING SERVICES ISSUED BY THE BOARD AND THAT IT WAS INCLUDED TO NOTIFY BIDDERS THAT THE CONTRACT WOULD NOT BE AWARDED ON LESS THAN THE TOTAL OF THE ITEMS IN THE INVITATION. WHILE THE SUCCEEDING SENTENCE IN THE INVITATION RESERVING TO THE BOARD THE RIGHT TO REJECT ANY BID "OR ANY PART THEREOF" APPEARS TO BE SOMEWHAT INCONSISTENT WITH THE EXPLANATION PRESENTED AS TO THE INTENT OF THE LANGUAGE, IT APPEARS CLEAR THAT THE DEFINITION PRESENTED BY MR. MCCABE IS NOT CORRECT SINCE THE BID ACTUALLY CONSISTS NOT OF AMOUNTS BUT OF RATES AND A TOTAL OR AGGREGATE OF THE RATES WOULD PROVIDE NO INDICATION OF TOTAL COST UNLESS THE NUMBER OF EACH OF THE ITEMS REQUIRED IS IDENTICAL. FURTHER, THE USE OF THE PHRASE ,AND NOT ITEM BY ITEM" CLEARLY INDICATES THAT THE TERM "AGGREGATE" WAS INTENDED TO MEAN THAT THE AWARD WOULD BE MADE ON THE TOTAL OR THE WHOLE AS OPPOSED TO AN "ITEM BY ITEM" BASIS. ACCORDINGLY, THERE IS NO BASIS FOR INTERPRETING THE SENTENCE IN QUESTION TO MEAN ANYTHING OTHER THAN INTENDED BY THE BOARD.

AS INDICATED ABOVE, WHERE THE BIDDERS ELECT TO FURNISH THE WORK TO THE BOARD WITHOUT COST, THE BIDS ARE TO BE EVALUATED IN PART ON THE BASIS OF THE LOWEST PRICES TO THE GOVERNMENT (EXCLUDING THE BOARD) AND TO THE PUBLIC. WHILE THE COST TO THE DEPARTMENT OF JUSTICE FOR ITS NORMAL REQUIREMENT WOULD BE LOWER UNDER THE MCCABE BID, THE COSTS TO THE GENERAL PUBLIC, AND PARTICULARLY, THE RESPONDENTS IN THE HEARINGS BEFORE THE BOARD, WOULD BE LOWER UNDER THE ALDERSON BID. THE BOARD DETERMINED THAT THE ALDERSON BID WAS THE MOST ADVANTAGEOUS IN TERMS OF THE BASIS FOR EVALUATION SET OUT IN THE INVITATION. THE BID MOST FAVORABLE TO THE GOVERNMENT MAY BE REJECTED WHERE IT IS ADMINISTRATIVELY DETERMINED THAT THE SALES PRICES TO THE PUBLIC UNDER SUCH BID ARE SO EXCESSIVE AS TO ADVERSELY AFFECT THE PUBLIC INTEREST. 32 COMP. GEN. 26 AND 26 COMP. GEN. 881. THE RULE IS PARTICULARLY APPLICABLE IN CIRCUMSTANCES SUCH AS HERE WHERE THE AVAILABILITY OF THE RECORD IS NECESSARY TO AFFORD ADEQUATE PROTECTION TO RESPONDENTS BEFORE THE BOARD, AND IS OF MATERIAL INTEREST TO THE PUBLIC GENERALLY. IT DOES NOT APPEAR THAT THE METHOD OF EVALUATING BIDS EMPLOYED BY THE BOARD IS ARBITRARY AND UNREASONABLE OR THAT IT IS NOT IN SUBSTANTIAL ACCORD WITH THE METHOD OF AWARD DESCRIBED IN THE INVITATION. ACCORDINGLY, THERE APPEARS TO BE NO PROPER BASIS FOR QUESTIONING THE AWARD OF A CONTRACT TO THE ALDERSON COMPANY. CF. B 19927, JANUARY 13, 1942.