B-136046, MAY 21, 1958, 37 COMP. GEN. 780

B-136046, MAY 21, 1958, 37 COMP. GEN. 780

BIDS - QUALIFIED - APPROXIMATE PRICE - MODIFICATION AFTER OPENING A LOW BIDDER WHO, IN RESPONSE TO A REQUEST FOR BIDS ON A FIRM, FIXED PRICE BASIS, SUBMITS A BID ON AN ITEM WHICH DOES NOT MEET THE SPECIFICATIONS BUT WHO ACCOMPANIES THE BID WITH AN OFFER TO FURNISH THE REQUIRED ITEM AT AN INCREASE OF "APPROXIMATELY $24.00" PER UNIT HAS NOT SUBMITTED A DEFINITE AND CERTAIN BID WITH A DETERMINABLE PRICE AND THE PROPOSAL BY THE BIDDER, AFTER OPENING, TO DELETE THE WORD "APPROXIMATELY" WOULD BE A MATERIAL CHANGE WHICH MAY NOT BE PERMITTED.

TO THE SECRETARY OF THE ARMY, MAY 21, 1958:

REFERENCE IS MADE TO LETTER DATED APRIL 31, 1958, FROM THE ASSISTANT SECRETARY ( LOGISTICS), REQUESTING OUR DECISION AS TO THE APPROPRIATE ACTION TO BE TAKEN WITH RESPECT TO THE BID SUBMITTED BY THE MODEL ENGINEERING AND MANUFACTURING COMPANY, INC., UNDER INVITATION FOR BIDS NO. SC-36-039-58-1770-G4, ISSUED BY THE U.S. ARMY SIGNAL SUPPLY AGENCY ON FEBRUARY 25, 1958, AND OPENED ON MARCH 31, 1958.

THE INVITATION, AS AMENDED, REQUESTED BIDS FOR THE FURNISHING OF TELEGRAPH-TELEPHONE TERMINAL EQUIPMENT IN ACCORDANCE WITH MILITARY SPECIFICATION NO. MIL-T-10267A, GOVERNMENT-FURNISHED MODELS AND DRAWINGS REFERRED TO IN THE SPECIFICATION. EIGHTEEN RESPONSIVE BIDS WERE RECEIVED, INCLUDING THE LOW BID OF MODEL AT AN AGGREGATE PRICE OF $4,478,999.96. THE NEXT LOWEST RESPONSIBLE BID IN THE AGGREGATE AMOUNT OF $4,631,766.40 WAS RECEIVED FROM THE NORTH ELECTRIC COMPANY. HOWEVER, THE CONTRACTING OFFICER PROPOSES TO REJECT THE BID OF MODEL AND AWARD THE CONTRACT TO NORTH ELECTRIC FOR THE FOLLOWING REASONS:

A. THE BID OF MODEL ON ALUMINUM CASES IS NOT RESPONSIVE SINCE THE SPECIFICATIONS CALL FOR MAGNESIUM CASES. THERE IS, MOREOVER, A DEFINITE NEED FOR MAGNESIUM CASES AND THE SPECIFICATIONS ARE NOT UNDULY RESTRICTIVE IN THAT RESPECT.

B. THE BID ON MAGNESIUM CASES AS EXPRESSED IN THE COVER LETTER IS NOT FIRM AS TO PRICE AND DOES NOT SPECIFY A DELIVERY SCHEDULE.

C. GOVERNMENT ESTIMATES AND PRIOR PROCUREMENT HISTORY INDICATE THAT NORTH ELECTRIC'S BID IS FAIR AND REASONABLE.

MODEL'S BID WAS ACCOMPANIED BY A COVER LETTER WHICH STATED THAT THE PRICES QUOTED ARE BASED ON SUPPLYING ALUMINUM RATHER THAN MAGNESIUM CASES AND,"IF MAGNESIUM MUST BE SUPPLIED," THE PRICES WOULD BE INCREASED BY "APPROXIMATELY TWENTY-FOUR DOLLARS ($24.00) PER CASE.' MODEL HAS PROTESTED AGAINST THE CONTEMPLATED ACTION OF THE CONTRACTING OFFICER. HAS OFFERED TO DELETE THE WORD ,APPROXIMATELY," FROM ITS BID AND CONTENDS THAT EVEN IF THE WORD MAY NOT BE DELETED, THE INTERPRETATION OF ITS BID SHOULD BE THAT THE PRICE INCREASE WOULD NOT EXCEED $24 PER CASE WITH THE RESULT THAT MODEL WOULD STILL BE THE LOW BIDDER.

IT IS FUNDAMENTAL THAT THE STATUTES RELATING TO COMPETITIVE BIDS FOR GOVERNMENT CONTRACTS CONTEMPLATE THE SUBMISSION OF BIDS WHICH ARE FIRM AND DEFINITE IN RESPECT TO THE PRICE TO BE PAID. WE HAVE CONSISTENTLY HELD THAT BIDS SO QUALIFIED AS TO RENDER THE CONTRACT PRICE INDEFINITE ARE FOR REJECTION FOR UNCERTAINTY. 19 COMP. GEN. 614. THE INVITATION FOR BIDS IN THIS CASE CLEARLY REQUESTED BIDS ON A FIRM, FIXED-PRICE BASIS TO ENABLE THE GOVERNMENT TO DETERMINE EXACTLY WHAT THE DESIRED EQUIPMENT WOULD COST. SINCE AN "APPROXIMATE" PRICE CONTEMPLATES A VARIATION EITHER UPWARDS OR DOWNWARDS IN THE SPECIFIED PRICE, 3A WORDS AND PHRASES 517, THE BID OF MODEL ENGINEERING AS SUBMITTED OBVIOUSLY WAS NOT DEFINITE AND CERTAIN SO AS TO PERMIT A DETERMINATION AS TO THE PRICE TO BE PAID FOR MAGNESIUM CASES.

WITH RESPECT TO MODEL'S PROPOSAL TO DELETE THE WORD "APPROXIMATELY," AND THUS MAKE ITS BID OF $24 FIRM, WE HAVE MANY TIMES CONSIDERED THE QUESTION AS TO WHETHER A BIDDER MAY BE PERMITTED TO CHANGE A PROVISION IN ITS BID SUBSEQUENT TO THE OPENING OF THE BID, AND WE HAVE HELD THAT IF THE PROVISION BE MATERIAL AND IN ANY WAY AFFECTS THE PRICE OF THE ARTICLES OFFERED--- AS IS THE CASE HERE--- A CHANGE MAY NOT BE PERMITTED. 31 COMP. GEN. 660; 34 COMP. GEN. 24.

ACCORDINGLY, YOU ARE ADVISED THAT THE BID OF MODEL ENGINEERING AND MANUFACTURING COMPANY, INC., MAY NOT BE CONSIDERED FOR AWARD.