B-132280, JUN. 27, 1957

B-132280, JUN. 27, 1957

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 19, 1957, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR THE GENERAL ELECTRIC COMPANY OF DENVER, COLORADO, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. 14-06-D-2309, DATED NOVEMBER 30, 1956, WAS AWARDED.

THE BUREAU OF RECLAMATION, DENVER, COLORADO, BY INVITATION NO. (D) D 22, 153-A, ISSUED NOVEMBER 5, 1956, REQUESTED BIDS FOR FURNISHING TWO ITEMS OF TRANSFORMERS FOR CASPER SUBSTATION, KENDRICK PROJECT, CASPER, WYOMING. RESPONSE, THE GENERAL ELECTRIC COMPANY SUBMITTED A BID OFFERING TO FURNISH ITEMS 1 AND 2 IN THE UNIT AMOUNTS OF $4,060 AND $2,450, RESPECTIVELY, FOR EACH OF THE THREE TRANSFORMERS REQUIRED UNDER EACH ITEM. THE BID OF THE COMPANY WAS ACCEPTED AS TO BOTH ITEMS ON NOVEMBER 30, 1956.

BY LETTER OF MARCH 4, 1957, WHICH IS IN AFFIDAVIT FORM, THE COMPANY ADVISED THAT ITS BID PRICE OF $2,450 EACH FOR ITEM 2 WAS IN ERROR IN THAT IT DID NOT INCLUDE ANY PRICE FOR PERFORMING THE IMPULSE TEST ON EACH TRANSFORMER AS REQUIRED BY THE TECHNICAL REQUIREMENTS OF THE INVITATION. THE CONTRACTOR CLAIMS THAT THE PRICE OF $350 FOR EACH OF THE THREE TESTS, OR A TOTAL OF $1,050, SHOULD HAVE BEEN ADDED TO THE BID PRICE OF ITEM 2, AND REQUESTS THAT THE TOTAL PRICE FOR THE ITEM BE INCREASED ACCORDINGLY. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE CONTRACTOR SUBMITTED A PRINTED PRICE LIST WHICH SPECIFIES A LIST PRICE OF $3,500, LESS 30 PERCENT DISCOUNT, OR A NET PRICE OF $2,450 FOR EACH TRANSFORMER REQUIRED UNDER ITEM 2 AND A LIST PRICE OF $500 FOR THE SPECIFIED IMPULSE TEST, LESS 30 PERCENT, OR A NET PRICE OF $350.

THE ABSTRACT OF BIDS SHOWS THAT THE UNIT PRICES QUOTED BY THE OTHER TWO BIDDERS UNDER ITEM 2 WERE $4,700 AND $4,830. IN VIEW OF THE SUBSTANTIAL DIFFERENCE BETWEEN THE BID OF THE GENERAL ELECTRIC COMPANY OF $2,450 EACH FOR ITEM 2 AND THE OTHER BIDS ON THAT ITEM AND THE ESTIMATE OF THE GOVERNMENT ENGINEER WHICH IS REPORTED TO HAVE BEEN $11,000 FOR THE THREE TRANSFORMERS INVOLVED, THE PROBABILITY OF ERROR WAS APPARENT. IN THE CIRCUMSTANCES, THEREFORE, THE BID AS TO ITEM 2 SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE COMPANY TO VERIFY ITS BID.

ON THE BASIS OF THE FACTS AND EVIDENCE OF RECORD, IT IS APPARENT THAT THE COMPANY MADE AN ERROR IN QUOTING A PRICE OF $2,450 EACH FOR ITEM 2 AS A RESULT OF ITS FAILURE TO INCLUDE THE PRICE OF PERFORMING THE IMPULSE TEST ON EACH TRANSFORMER AS REQUIRED BY THE TECHNICAL REQUIREMENTS OF THE INVITATION. ACCORDINGLY, PAYMENT IS AUTHORIZED TO BE MADE TO THE GENERAL ELECTRIC COMPANY AT A PRICE OF$2,800 EACH FOR THE TRANSFORMERS FURNISHED UNDER ITEM 2 OF THE CONTRACT.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE VOUCHER COVERING SUCH PAYMENT.