B-132611, SEPTEMBER 10, 1957, 37 COMP. GEN. 186

B-132611: Sep 10, 1957

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BIDS - INTERRELATED PROCUREMENTS - COMBINED BIDS THE CONSIDERATION OF AN ALTERNATE LUMP-SUM BID WHICH IS SUBMITTED IN RESPONSE TO TWO SEPARATE INVITATIONS AND WHICH IS LESS THAN THE TOTAL OF THE LOW BIDS RECEIVED ON EACH INVITATION WOULD PRODUCE INEQUALITY AND CONFUSION IN COMPETITIVE BIDDING PROCEDURES. 1957: REFERENCE IS MADE TO THE REPORT OF AUGUST 2. WHICH WAS REQUESTED BY US FOLLOWING THE RECEIPT IN OUR OFFICE OF A LETTER FROM INGERSOLL-RAND COMPANY. THE BASIS OF THE PROTEST IS THAT A SINGLE AWARD FOR THE ITEMS IN QUESTION SHOULD BE MADE TO INGERSOLL-RAND WHOSE LUMP-SUM PRICE FOR ALL OF THE ITEMS IS LOWER THAN THE TOTAL OF THE PRICES SUBMITTED BY INDIVIDUAL LOW BIDDERS UNDER THE INVITATIONS.

B-132611, SEPTEMBER 10, 1957, 37 COMP. GEN. 186

BIDS - INTERRELATED PROCUREMENTS - COMBINED BIDS THE CONSIDERATION OF AN ALTERNATE LUMP-SUM BID WHICH IS SUBMITTED IN RESPONSE TO TWO SEPARATE INVITATIONS AND WHICH IS LESS THAN THE TOTAL OF THE LOW BIDS RECEIVED ON EACH INVITATION WOULD PRODUCE INEQUALITY AND CONFUSION IN COMPETITIVE BIDDING PROCEDURES, IN THAT BIDDERS HAD A RIGHT TO ASSUME THAT SEPARATE INVITATIONS REQUIRED SEPARATE PROPOSALS, AND ONLY THOSE BIDDERS WHO KNEW OF THE ISSUANCE OF THE TWO INVITATIONS COULD TAKE ADVANTAGE OF THE INTERRELATIONSHIP OF THE PROCUREMENT.

TO THE SECRETARY OF COMMERCE, SEPTEMBER 10, 1957:

REFERENCE IS MADE TO THE REPORT OF AUGUST 2, 1957, FROM THE ASSISTANT SECRETARY OF COMMERCE FOR ADMINISTRATION, WITH ENCLOSURES, WHICH WAS REQUESTED BY US FOLLOWING THE RECEIPT IN OUR OFFICE OF A LETTER FROM INGERSOLL-RAND COMPANY, PROTESTING THE POSSIBLE AWARD OF CONTRACTS TO THE LOW BIDDERS UNDER BUREAU OF PUBLIC ROADS INVITATION NO. BPR-61-6, ITEMS 1 (B) AND 1 (C), AND INVITATION NO. BPR-61-6, ITEM 1 (A). THE BASIS OF THE PROTEST IS THAT A SINGLE AWARD FOR THE ITEMS IN QUESTION SHOULD BE MADE TO INGERSOLL-RAND WHOSE LUMP-SUM PRICE FOR ALL OF THE ITEMS IS LOWER THAN THE TOTAL OF THE PRICES SUBMITTED BY INDIVIDUAL LOW BIDDERS UNDER THE INVITATIONS. WORTHINGTON CORPORATION HAS PROTESTED THE POSSIBLE AWARD TO INGERSOLL-RAND ON THE LUMP-SUM BASIS.

INVITATION NO. BPR-61-6, ITEMS 1 (B) AND 1 (C), ISSUED JUNE 13, 1957, SOLICITED BIDS FOR JACKHAMMERS AND PAVING BREAKERS F.O.B. AND F.A.S. POINT. INVITATION NO. BPR-61-6, ITEM 1 (A), ISSUED JUNE 17, 1957, SOLICITED BIDS FOR AIR COMPRESSORS F.O.B. AND F.A.S. POINT. BOTH INVITATIONS WERE SCHEDULED FOR OPENING ON JULY 10, 1957, EXCEPT THAT THE JACKHAMMERS/PAVING BREAKERS INVITATION WAS SCHEDULED FOR 2:00 P.M. AND THE AIR COMPRESSOR INVITATION FOR 2:30 P.M. THE INVITATIONS CONTAINED NO LANGUAGE INDICATING ANY INTERRELATIONSHIP BETWEEN THE TWO PROCUREMENTS.

SEVEN BIDS WERE RECEIVED FOR THE JACKHAMMERS AND PAVING BREAKERS. CHICAGO PNEUMATIC TOOL COMPANY WAS THE LOW BIDDER FOR THE JACKHAMMERS. THE SECOND AND THIRD LOW BIDDERS WERE WORTHINGTON AND INGERSOLL-RAND, RESPECTIVELY. THE LOW BIDDER AND SECOND LOW BIDDER FOR THE PAVING BREAKERS WERE WORTHINGTON AND INGERSOLL-RAND, RESPECTIVELY.

FOUR BIDS WERE RECEIVED FOR THE AIR COMPRESSORS. WORTHINGTON WAS THE LOW BIDDER FOR THIS EQUIPMENT. INGERSOLL-RAND WAS THE SECOND LOW BIDDER.

ATTACHED TO AND MADE A PART OF BOTH OF THE BIDS SUBMITTED BY INGERSOLL- RAND WAS THE FOLLOWING CONDITION:

IN THE EVENT AWARD IS MADE TO THE INGERSOLL-RAND COMPANY FOR ITEMS 1 (B) AND 1 (C) OF INVITATION NO. BPR-61-6 AND ITEM 1 (A) OF INVITATION NO. BPR- 61-6, A SAVING WILL BE EFFECTED AND WHICH SAVING WE ARE WILLING TO PASS ON TO THE GOVERNMENT. WE THEREFORE MAKE A LUMP SUM BID TO SUPPLY ITEMS 1 (B) AND 1 (C) OF INVITATION NO. BPR-61-6 AND ITEM 1 (A) OF INVITATION NO. BPR- 61-6 FOR A TOTAL LUMP-SUM PRICE OF $37,425.00 F.A.S. NEW YORK, PACKED FOR OVERSEAS SHIPMENT IN CONFORMITY WITH THE STANDARD COMMERCIAL PRACTICE FOR EXPORT SHIPPING, AS SPECIFIED.

THE ALTERNATE LUMP-SUM BID MADE BY INGERSOLL-RAND IS LESS THAN THE TOTAL OF THE LOW BIDS RECEIVED ON EACH INVITATION; HOWEVER, FOR SEVERAL REASONS WE BELIEVE THIS BID PROPERLY MAY NOT BE ACCEPTED.

IN THE FIRST PLACE, THE OPPORTUNITY TO COMBINE BIDS UNDER THE TWO INVITATIONS WAS AVAILABLE ONLY TO THE BIDDERS WHO KNEW OF THE ISSUANCE OF BOTH INVITATIONS. ALL OF THE BIDDERS WHO MIGHT HAVE BEEN INTERESTED IN QUOTING ON THE TWO PROCUREMENTS WERE NOT NECESSARILY IN THIS POSITION, AND THE COURTS AND OUR OFFICE HAVE CONSISTENTLY HELD THAT UNDER THE COMPETITIVE BIDDING PROCEDURES ALL PROSPECTIVE BIDDERS FOR A PARTICULAR PROCUREMENT MUST BE IN A POSITION OF EQUALITY.

SECONDLY, THE ISSUANCE OF TWO SEPARATE INVITATIONS WAS SUFFICIENT IN ITSELF TO RAISE THE PRESUMPTION IN THE MINDS OF BIDDERS THAT SEPARATE AND INDEPENDENT BIDS WERE REQUIRED. IN FACT, IN 8 COMP. GEN. 663, OUR OFFICE HELD THAT SEPARATE INVITATIONS DO REQUIRE SEPARATE PROPOSALS AND THAT AWARDS SHOULD BE BASED ON THE LOW BID RECEIVED IN RESPONSE TO EACH INVITATION. AND AS LATE AS FEBRUARY 14, 1956, WE HELD IN 35 COMP. GEN. 456 THAT A BIDDER MAY NOT TAKE ADVANTAGE OF AN INTERRELATIONSHIP BETWEEN TWO INVITATIONS. ALTHOUGH THE FACTS IN THESE TWO PUBLISHED DECISIONS DIFFER IN CERTAIN MATERIAL RESPECTS FROM THE FACTS HERE INVOLVED, THE CONCLUSIONS REACHED THEREIN ARE SUFFICIENTLY IN POINT TO HAVE CAUSED THE BIDDERS IN THIS CASE TO ASSUME THAT COMBINATION BIDS WOULD NOT BE PERMISSIBLE.

FINALLY, AS A PRACTICAL CONSIDERATION, A CONCLUSION THAT THE LUMP SUM BID IN THIS CASE PROPERLY COULD BE ACCEPTED CONCEIVABLY COULD LEAD TO A SIMILAR CONCLUSION WHERE THE RELATED INVITATIONS WERE ISSUED BY SEPARATE GOVERNMENT AGENCIES WHICH, FOR OBVIOUS REASONS, WOULD PRODUCE AN UNWORKABLE SITUATION.

THEREFORE, ON THE ASSUMPTION THAT THE USUAL COMPETITIVE BIDDING PROCEDURES ARE FOR APPLICATION IN THIS CASE, AS WE HAVE BEEN INFORMALLY ADVISED BY YOUR DEPARTMENT, IT IS OUR VIEW THAT THE LUMP-SUM BID SUBMITTED BY INGERSOLL-RAND SHOULD BE DISREGARDED IF AWARDS ARE TO BE MADE UNDER THE PRESENT INVITATIONS.