B-134799, JAN. 14, 1958

B-134799: Jan 14, 1958

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TO THE SECRETARY OF AGRICULTURE: REFERENCE IS MADE TO A LETTER DATED DECEMBER 17. ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. 12-14-100 2533/44) WAS AWARDED. THE BID OF THE COMPANY WAS ACCEPTED AS TO ITEMS 1 AND 2. PURCHASE ORDER NO. 5247-ARS-58 WAS ISSUED REQUESTING DELIVERY OF THE HAY. IT IS REPORTED THAT BY LETTER DATED NOVEMBER 9. R. DEIBERT COMPANY ADVISED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT IT SHOULD HAVE QUOTED A PRICE OF $62 PER TON INSTEAD OF $40 PER TON FOR THE ALFALFA HAY. WAS LISTED DIRECTLY ABOVE THE PRICE OF THE UNITED STATES NO. 2 ALFALFA HAY. IT IS STATED THAT THE SPREAD IN PRICES BETWEEN THE THREE LOWEST BIDS ON THE ALFALFA HAY DID NOT PLACE THE CONTRACTING OFFICER ON NOTICE THAT AN APPARENT ERROR HAD BEEN MADE BY THE E.

B-134799, JAN. 14, 1958

TO THE SECRETARY OF AGRICULTURE:

REFERENCE IS MADE TO A LETTER DATED DECEMBER 17, 1957, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH THE E. R. DEIBERT COMPANY, RISING SUN, MARYLAND, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. 12-14-100 2533/44) WAS AWARDED.

THE AGRICULTURAL RESEARCH SERVICE, ADMINISTRATIVE SERVICES DIVISION, WASHINGTON, D.C., BY INVITATION NO. ARS-175-B-58, REQUESTED BIDS--- TO BE OPENED OCTOBER 31, 1957--- FOR FURNISHING 152 TONS OF UNITED STATES NO. 2 LEAFY ALFALFA HAY, 45 PERCENT GREEN COLOR, BALED, TO BE DELIVERED BY TRUCK AND STORED IN SHEEP BARNS AND HORSE BARNS, AGRICULTURAL RESEARCH CENTER, BELTSVILLE, MARYLAND, ITEMS 1 AND 2. IN RESPONSE E. R. DEIBERT COMPANY SUBMITTED A BID OFFERING TO FURNISH THE ALFALFA HAY UNDER ITEMS 1 AND 2 AT A UNIT PRICE OF $40 PER TON OR FOR A TOTAL PRICE OF $6,080. ON NOVEMBER 1, 1957, THE BID OF THE COMPANY WAS ACCEPTED AS TO ITEMS 1 AND 2, AND ON NOVEMBER 5, 1957, PURCHASE ORDER NO. 5247-ARS-58 WAS ISSUED REQUESTING DELIVERY OF THE HAY.

IT IS REPORTED THAT BY LETTER DATED NOVEMBER 9, 1957, IN WHICH IT REQUESTED THAT THE AWARD TO IT BE CANCELED, THE E. R. DEIBERT COMPANY ADVISED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT IT SHOULD HAVE QUOTED A PRICE OF $62 PER TON INSTEAD OF $40 PER TON FOR THE ALFALFA HAY; THAT ON NOVEMBER 26, 1957, THE COMPANY ADVISED THAT, IN READING ITS WHOLESALE PRICE LIST, IT INADVERTENTLY COPIED DOWN ON THE BID FORM THE PRICE FOR MIXED HAY CONSISTING OF TIMOTHY AND CLOVER WHICH, IT STATED, WAS LISTED DIRECTLY ABOVE THE PRICE OF THE UNITED STATES NO. 2 ALFALFA HAY; AND THAT BY LETTER DATED DECEMBER 3, 1957, THE COMPANY SUBMITTED ITS FILE COPY OF THE WHOLESALE PRICE LIST ON HAY AND STRAW WITH A FURTHER EXPLANATION AS TO HOW IT OBTAINED ITS PRICES.

IN THE LETTER OF DECEMBER 17, 1957, IT IS STATED THAT THE SPREAD IN PRICES BETWEEN THE THREE LOWEST BIDS ON THE ALFALFA HAY DID NOT PLACE THE CONTRACTING OFFICER ON NOTICE THAT AN APPARENT ERROR HAD BEEN MADE BY THE E. R. DEIBERT COMPANY AS THIS SAME COMPANY HAD BID A PRICE OF $45 PER TON ON THE SAME GRADE AND CLASS OF HAY IN FEBRUARY 1957 UNDER INVITATION NO. ARS-217-B-57 AND THAT IT WAS AWARDED A CONTRACT AT THAT PRICE. IT IS ALSO STATED THAT THE HAY MARKET OPERATES SIMILAR TO THE GRAIN MARKET WHEREIN THE PRICES ARE CONSTANTLY FLUCTUATING AND THE CONTRACTING OFFICER IS NOT AWARE OF THESE CHANGING PRICES.

THE ABSTRACT OF THE BIDS RECEIVED IN RESPONSE TO INVITATION NO. ARS 175-B -58 SHOWS THAT OF THE TWO OTHER BIDDERS WHO QUOTED ON BOTH ITEMS 1 AND 2, ONE BIDDER SPECIFIED A PRICE OF $60.09 PER TON FOR BOTH ITEMS AND THAT THE OTHER BIDDER SPECIFIED PRICES OF $61 AND $60.50 PER TON FOR ITEMS 1 AND 2, RESPECTIVELY. IT ALSO SHOWS THAT ONE OTHER BIDDER QUOTED ONLY ON ITEM 2 AND THAT FOR THAT ITEM, IT QUOTED A PRICE OF $57.50 PER TON. THUS, THE BID OF THE E. R. DEIBERT COMPANY OF $40 PER TON FOR ITEMS 1 AND 2 IS COMPLETELY OUT OF LINE WITH THE OTHER BIDS RECEIVED THEREON. THE ABSTRACT OF THE BIDS RECEIVED IN RESPONSE TO INVITATION NO. ARS-217-B-57, THE PREVIOUS INVITATION, SHOWS THAT THE E. R. DEIBERT COMPANY QUOTED A PRICE OF $45 PER TON FOR UNITED STATES NO. 2 ALFALFA HAY COVERED BY ITEM 1 (DELIVERED TO BARN AND STORED) AND THAT THE TWO OTHER BIDDERS ON THAT ITEM QUOTED PRICES OF $53.50 AND $54.45 PER TON. THE DIFFERENCE BETWEEN THE TWO LOWEST BIDS SUBMITTED IN RESPONSE TO THE PREVIOUS INVITATION AMOUNTS TO $8.50 PER TON, WHEREAS THE DIFFERENCE BETWEEN THE TWO LOWEST BIDS OFFERING TO FURNISH THE ENTIRE QUANTITY OF HAY REQUIRED UNDER THE SUBJECT INVITATION AMOUNTS TO MORE THAN $20 PER TON. IT IS ALSO NOTED THAT THE TOTAL PRICE OF $6,080 QUOTED BY THE E. R. DEIBERT COMPANY FOR FURNISHING 152 TONS OF ALFALFA HAY IS BELOW THE GOVERNMENT'S ESTIMATE OF $9,120. THE CIRCUMSTANCES, AND SINCE THE COMMODITY INVOLVED IS ONE FOR WHICH IT APPEARS THAT THERE IS A REGULAR ACTIVE MARKET THE CURRENT PRICES ON WHICH ARE READILY AVAILABLE, THE COMPANY SHOULD HAVE BEEN REQUESTED TO VERIFY ITS BID PRICE PRIOR TO THE ACCEPTANCE OF ITS BID.

IT IS REPORTED THAT NO DELIVERIES HAVE BEEN MADE BY THE E. R. DEIBERT COMPANY. ACCORDINGLY, CONTRACT NO. 12-14-100-2533/44) MAY BE CANCELED WITHOUT LIABILITY TO THE COMPANY.