B-132373, AUG. 13, 1957

B-132373: Aug 13, 1957

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C. LOVEYS COMPANY: REFERENCE IS MADE TO YOUR TELEGRAM DATED JUNE 28. THE REPORT FROM THE DEPARTMENT OF THE NAVY IN THIS MATTER INDICATES THAT BIDS WERE REQUESTED ON SEVEN ITEMS COVERING THE WORK TO BE PERFORMED UNDER THIS CONTRACT. BIDS ON A LUMP-SUM BASIS WERE REQUESTED UNDER ITEM 1 ON THE ENTIRE WORK (EXCEPT CONCRETE PILING). WHILE LUMP SUM BIDS UNDER ITEMS 2 THROUGH 5 WERE TO BE BASED UPON THE WORK COVERED BY ITEM 1. UNIT PRICE BIDS ON CONCRETE PILING WERE REQUESTED UNDER ITEMS 6 AND 7 AS FOLLOWS: "ITEM 6. IN THE EVENT THAT THE ACTUAL QUANTITY VARIES BY MORE THAN 25 PERCENT AN ADJUSTMENT IN THE CONTRACT PRICE WILL BE MADE IN ACCORDANCE WITH THE PERTINENT CLAUSE OF THE CONTRACT FOR THAT QUANTITY IN EXCESS OF 25 PERCENT VARIATION.

B-132373, AUG. 13, 1957

TO D. C. LOVEYS COMPANY:

REFERENCE IS MADE TO YOUR TELEGRAM DATED JUNE 28, 1957, AND YOUR LETTER DATED JULY 8, PROTESTING THE AWARD OF CONTRACT NBY-12794, FOR THE CONSTRUCTION OF A NAVAL AND MARINE CORPS RESERVE TRAINING CENTER AT QUINCY, MASSACHUSETTS, TO S. VOLPE AND COMPANY, INC., BY THE DEPARTMENT OF THE NAVY.

THE REPORT FROM THE DEPARTMENT OF THE NAVY IN THIS MATTER INDICATES THAT BIDS WERE REQUESTED ON SEVEN ITEMS COVERING THE WORK TO BE PERFORMED UNDER THIS CONTRACT. BIDS ON A LUMP-SUM BASIS WERE REQUESTED UNDER ITEM 1 ON THE ENTIRE WORK (EXCEPT CONCRETE PILING), WHILE LUMP SUM BIDS UNDER ITEMS 2 THROUGH 5 WERE TO BE BASED UPON THE WORK COVERED BY ITEM 1, LESS CERTAIN PORTIONS OF SUCH WORK AS SPECIFIED. UNIT PRICE BIDS ON CONCRETE PILING WERE REQUESTED UNDER ITEMS 6 AND 7 AS FOLLOWS:

"ITEM 6. UNIT PRICE PER LINEAR FOOT FOR 4410 LINEAR FEET OF CAST IN- PLACE CONCRETE PILES PROVIDED IN PLACE; THE UNIT PRICE SHALL ALSO APPLY IN CASE OF OVERRUN OR UNDERRUN OF THE QUANTITY STATED UP TO 25 PERCENT VARIATION; IN THE EVENT THAT THE ACTUAL QUANTITY VARIES BY MORE THAN 25 PERCENT AN ADJUSTMENT IN THE CONTRACT PRICE WILL BE MADE IN ACCORDANCE WITH THE PERTINENT CLAUSE OF THE CONTRACT FOR THAT QUANTITY IN EXCESS OF 25 PERCENT VARIATION. THIS BID ITEM WILL BE USED IN CONNECTION WITH BID ITEMS 1, 2 AND 3.

"ITEM 7. UNIT PRICE PER LINEAL (SIC.) FOOT FOR 4200 LINEAR FEET OF CAST -IN-PLACE CONCRETE PILES PROVIDED IN PLACE; THE UNIT PRICE SHALL ALSO APPLY IN CASE OF OVERRUN OR UNDERRUN OF THE QUANTITY STATED UP TO 25 PERCENT VARIATION; IN THE EVENT THAT THE ACTUAL QUANTITY VARIES BY MORE THAN 25 PERCENT AN ADJUSTMENT IN THE CONTRACT PRICE WILL BE MADE IN ACCORDANCE WITH THE PERTINENT CLAUSE OF THE CONTRACT FOR THAT QUANTITY IN EXCESS OF 25 PERCENT VARIATION. THIS BID ITEM WILL BE USED IN CONNECTION WITH BID ITEMS 4 AND 5.'

BOTH ITEM 6 AND ITEM 7 WERE SUBJECT TO THE FOLLOWING NOTE:

"NOTE: THE AWARD WILL BE MADE ON THE BASIS OF THE SUM TOTAL OF ONE OF BID ITEMS 1 THROUGH 5 PLUS THE PRODUCT OF THE APPLICABLE UNIT PRICE QUOTED ABOVE MULTIPLIED BY THE SPECIFIED QUANTITY.'

S. VOLPE AND COMPANY, INC., SUBMITTED A BID OF $444,700 ON ITEM 1, $21,168 ON ITEM 6, AND $20,160 ON ITEM 7. YOUR BID WAS IN THE AMOUNT OF $447,160 ON ITEM 1, $4.80 ON ITEM 6, AND $4.80 ON ITEM 7. TWO OTHER BIDDERS ALSO SUBMITTED BID PRICES OF $4.80 ON ITEMS 6 AND 7, WHILE THE REMAINING BIDS ON SUCH ITEMS RANGED FROM $5.00 TO $6.05. THE DEPARTMENT OF THE NAVY HAS ADVISED THAT, FROM A COMPARISON OF THE BID PRICES RECEIVED ON THESE ITEMS, IT WAS APPARENT TO THE OFFICER IN CHARGE OF THE BID OPENING THAT THE PRICES SUBMITTED BY S. VOLPE AND COMPANY DID NOT REPRESENT UNIT PRICES ON A LINEAR FOOT BASIS BUT DID REPRESENT FAIR BID PRICES FOR THE WORK ON A LUMP-SUM BASIS. PRIOR TO AWARD, AND UPON REQUEST FOR CLARIFICATION, THE BIDDER ADVISED THAT HIS BID ON THESE ITEMS WAS COMPUTED ON THE BASIS OF $4.80 PER LINEAR FOOT BUT WAS SUBMITTED ON A LUMP -SUM BASIS DUE TO HIS SECRETARY'S MISUNDERSTANDING OF HIS INSTRUCTIONS AND OF REQUIREMENTS OF THE BID INVITATION. SUCH ADVICE WAS OF COURSE SUBSTANTIATED BY MATHEMATICAL COMPUTATION AND BY THE FACT THAT THREE OTHER BIDDERS HAD SUBMITTED BIDS OF $4.80 ON THE ITEMS IN QUESTION. BASED UPON SUCH ADVICE AND EVALUATION THE AWARD WAS MADE TO S. VOLPE AND COMPANY, INC., AS FOLLOWS:

TABLE

ITEM 1 $444,700

ITEM 6 $4.80 TIMES 4410 L.F. 21,168

TOTAL $465,868

YOUR PROTEST AGAINST THE AWARD IS BASED UPON THE PREMISE THAT THE BID PRICE OF $21,168 SUBMITTED ON ITEM 6 BY THE SUCCESSFUL BIDDER WAS IN ERROR, THAT THE RELIEF GRANTED TO THE BIDDER FOR SUCH ERROR SHOULD BE LIMITED TO PERMISSION TO WITHDRAW THE BID, AND THAT PERMITTING CORRECTION OF THE BID PRICE MERELY BECAUSE IT RESULTS IN A SAVING TO THE GOVERNMENT HAS EVERY APPEARANCE OF CONSTITUTING THE PRACTICE OF BID-SHOPPING.

THE EVALUATION OF BID PRICES SUBMITTED ON ITEMS 6 AND 7 WAS TO BE MADE IN A LUMP-SUM AMOUNT COMPUTED ON THE BASIS OF A SPECIFIED NUMBER OF UNITS MULTIPLIED BY A UNIT PRICE. UNDER THE CIRCUMSTANCES, THE TOTAL BID PRICE FOR EVALUATION AND AWARD PURPOSES WAS TO BE THE SAME WHETHER SUBMITTED ON A UNIT OR LUMP SUM BASIS, AND THE UNIT PRICE, AS SUCH, WOULD BECOME IMPORTANT ONLY IN THE EVENT OF OVERRUN OR UNDERRUN IN THE BASIC ESTIMATED QUANTITY, WHICH WERE NOT FACTORS TO BE CONSIDERED IN THE EVALUATION OF BIDS. IT IS THEREFORE OUR OPINION THAT THE REQUEST FOR UNIT PRICE BIDS ON ITEMS 6 AND 7 WAS SOLELY FOR THE CONVENIENCE OF THE GOVERNMENT, AND THAT CONSIDERATION OF LUMP-SUM BID PRICES SUBMITTED ON SUCH ITEMS DID NOT RESULT IN ANY CHANGE IN THE BID PRICE WHICH COULD BE CONSIDERED DETRIMENTAL TO THE RIGHTS OF OTHER BIDDERS. AS AWARDED, CONTRACT NBY- 12794 IS IN THE EXACT AMOUNT OF THE BID WHICH THE CONTRACTOR SUBMITTED AND, SINCE SUCH BID WAS THE LOWEST BID RECEIVED UNDER THE INVITATION, WE WOULD NOT BE JUSTIFIED IN RAISING ANY OBJECTION TO THE AWARD.