B-140130, JUL. 23, 1959

B-140130: Jul 23, 1959

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FEDERAL AVIATION AGENCY: REFERENCE IS MADE TO YOUR LETTER OF JULY 2. FA3-250 WAS AWARDED. THE WORK TO BE PERFORMED UNDER SCHEDULE NO. 2 WAS DIVIDED INTO 21 ITEMS FOR THE PURPOSES OF SUBMITTING BIDS AND FOR MAKING PAYMENT FOR THE WORK TO BE PERFORMED. ON SCHEDULE NO. 2 WAS ACCEPTED AND COPIES OF THE CONTRACT AND BOND FORMS WERE TRANSMITTED TO THE CORPORATION FOR EXECUTION. ADVISED THE CONTRACTING OFFICER THAT IT WAS RETURNING THE CONTRACT AND BOND FORMS UNSIGNED FOR THE REASON THAT AN ERROR HAD BEEN MADE IN ITS BID ON ITEM 17 OF SCHEDULE NO. 2. SHOULD HAVE BEEN QUOTED FOR ITEM 17. THAT HE WAS WITHOUT AUTHORITY TO INCREASE THE UNIT PRICE FOR ITEM 17 OF SCHEDULE NO. 2 BUT THAT AFTER EXECUTION OF THE CONTRACT AND BOND FORMS.

B-140130, JUL. 23, 1959

TO HONORABLE E. R. QUESADA, ADMINISTRATOR, FEDERAL AVIATION AGENCY:

REFERENCE IS MADE TO YOUR LETTER OF JULY 2, 1959, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR WHICH THE HENKELMANN CONSTRUCTION COMPANY, INC., GREEN BAY, WISCONSIN, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. FA3-250 WAS AWARDED.

THE FEDERAL AVIATION AGENCY, KANSAS CITY, MISSOURI, BY INVITATION NO. 3- 59-39 REQUESTED BIDS UNDER SCHEDULE NO. 2 FOR FURNISHING LABOR, CERTAIN MATERIALS AND PERFORMING ALL WORK IN CONNECTION WITH THE CONSTRUCTION OF A HIGH INTENSITY APPROACH LIGHT SYSTEM. THE WORK TO BE PERFORMED UNDER SCHEDULE NO. 2 WAS DIVIDED INTO 21 ITEMS FOR THE PURPOSES OF SUBMITTING BIDS AND FOR MAKING PAYMENT FOR THE WORK TO BE PERFORMED. IN RESPONSE THE HENKELMANN CONSTRUCTION COMPANY, INC., SUBMITTED A BID DATED MARCH 23, 1959, OFFERING TO PERFORM THE WORK DESCRIBED UNDER ITEMS 1 TO 21, INCLUSIVE, OF SCHEDULE NO. 2 FOR THE TOTAL AGGREGATE BID PRICE OF $19,449.80. ON MARCH 25, 1959, THE AGGREGATE BID OF THE HENKELMANN CONSTRUCTION COMPANY, INC., ON SCHEDULE NO. 2 WAS ACCEPTED AND COPIES OF THE CONTRACT AND BOND FORMS WERE TRANSMITTED TO THE CORPORATION FOR EXECUTION.

BY LETTER DATED MARCH 28, 1959, THE HENKELMANN CONSTRUCTION COMPANY, INC., ADVISED THE CONTRACTING OFFICER THAT IT WAS RETURNING THE CONTRACT AND BOND FORMS UNSIGNED FOR THE REASON THAT AN ERROR HAD BEEN MADE IN ITS BID ON ITEM 17 OF SCHEDULE NO. 2; AND THAT A UNIT PRICE OF $748.28 RATHER THAN A UNIT PRICE OF $185, WHICH AMOUNT, IT STATED, COVERED ONLY THE COST OF THE ELECTRICAL WORK, SHOULD HAVE BEEN QUOTED FOR ITEM 17. IN REPLY THERETO THE CONTRACTING OFFICER ADVISED THE CORPORATION BY LETTER DATED MARCH 31, 1959, THAT HE WAS WITHOUT AUTHORITY TO INCREASE THE UNIT PRICE FOR ITEM 17 OF SCHEDULE NO. 2 BUT THAT AFTER EXECUTION OF THE CONTRACT AND BOND FORMS, THE CORPORATION COULD SUBMIT A STATEMENT EXPLAINING THE ERROR IN ITS BID, WHICH WOULD BE TRANSMITTED TO THE COMPTROLLER GENERAL OF THE UNITED STATES FOR HIS CONSIDERATION. BY LETTER DATED APRIL 3, 1959, THE CORPORATION SUBMITTED A STATEMENT EXPLAINING THE ERROR IN ITS BID AND IN ITS LETTER THE CORPORATION STATED THAT IT WAS AGAIN RETURNING THE CONTRACT AND BOND FORMS UNSIGNED BECAUSE IT WAS UNABLE TO PERFORM THE WORK DESCRIBED UNDER ITEM 17 OF SCHEDULE NO. 2 AT THE PRICE SPECIFIED IN THE CONTRACT. WITH ITS LETTER THE CORPORATION SUBMITTED A COST BREAKDOWN OF ITS INTENDED BID PRICE OF $748.28 FOR ITEM 17 OF SCHEDULE NO. 2 AND ON THE SHEET CONTAINING SUCH BREAKDOWN, THE CORPORATION INDICATED THAT THE CORRECT AGGREGATE BID PRICE FOR SCHEDULE NO. 2 IS $23,392.76. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE CORPORATION SUBMITTED ITS ORIGINAL WORKSHEET ON ITEM 17 OF SCHEDULE NO. 2. THE WORKSHEET SHOWS THE PRICES FOR EXCAVATING, CONCRETE AND GRADING WORK, STRUCTURAL STEEL, PAINTING, SOCIAL SECURITY AND UNEMPLOYMENT TAXES, AND PROFIT OF 10 PERCENT, AND THE TOTAL OF SUCH PRICES IS SHOWN AS $554.50. BELOW THE AMOUNT OF $554.50, THERE APPEARS ON THE WORKSHEET A UNIT PRICE OF $185 FOR ELECTRICAL WORK, WHICH PRICE THE CORPORATION ALLEGES IT ERRONEOUSLY QUOTED AS THE UNIT PRICE FOR ITEM 17 OF SCHEDULE NO. 2. BY LETTER DATED APRIL 7, 1959, THE CONTRACTING OFFICER ADVISED THE CORPORATION THAT UNLESS IT EXECUTED AND RETURNED THE ENCLOSED CONTRACT AND BOND FORMS BY THE DATE SPECIFIED THEREIN, IT WOULD BE CONSIDERED IN DEFAULT UNDER THE CONTRACT AND THAT THE CONTRACT WOULD BE AWARDED TO THE NEXT LOWEST BIDDER. THE RECORD INDICATES THAT IN RESPONSE TO THIS REQUEST, THE CORPORATION EXECUTED AND RETURNED THE CONTRACT AND BOND FORMS AND THAT SUCH FORMS WERE RECEIVED BY THE CONTRACTING OFFICE ON APRIL 14, 1959.

THE LIST OF BIDS IN THE CONTRACTING OFFICER'S REPORT SHOWS THAT THE FOUR OTHER AGGREGATE BIDS ON SCHEDULE NO. 2 WERE IN THE AMOUNTS OF $25,050, $25,646, $30,021.75, AND $30,395.75, AND THAT THE GOVERNMENT'S ESTIMATE FOR THE SCHEDULE WAS $31,414.50. IN VIEW OF THE DIFFERENCE BETWEEN THE AGGREGATE BID OF HENKELMANN CONSTRUCTION COMPANY, INC., OF $19,449.80 FOR SCHEDULE NO. 2 AND THE NEXT LOWEST AGGREGATE BID RECEIVED THEREON, THE PROBABILITY OF ERROR WAS APPARENT AND, IN THESE CIRCUMSTANCES, THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE CORPORATION TO VERIFY ITS BID ON SCHEDULE NO. 2.

THERE APPEARS LITTLE ROOM FOR DOUBT THAT THE CORPORATION MADE A BONA FIDE ERROR ON ITEM 17 OF SCHEDULE NO. 2, AS ALLEGED, AND IT APPEARS THAT THE PRICE THE CORPORATION INTENDED TO BID FOR THAT ITEM IS ESTABLISHED SUFFICIENTLY BY THE CORPORATION'S WORKSHEET AND COST BREAKDOWN. ACCORDINGLY, SINCE THE RECORD INDICATES THAT THE CORPORATION WAS INSTRUCTED TO PERFORM THE WORK REQUIRED UNDER SCHEDULE NO. 2, SUBJECT TO ACTION BY THE COMPTROLLER GENERAL OF THE UNITED STATES ON THE CLAIM FOR RELIEF, CONTRACT NO. FA3-250 MAY BE AMENDED TO INCREASE THE UNIT PRICE FOR ITEM 17 TO $748.28 AND PAYMENT FOR THAT ITEM IS AUTHORIZED TO BE MADE ON THAT BASIS. THE AGGREGATE BID OF THE HENKELMANN CONSTRUCTION COMPANY, INC., ON SCHEDULE NO. 2, AS CORRECTED, WILL STILL BE THE LOWEST AGGREGATE BID RECEIVED ON THAT SCHEDULE.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO BE ATTACHED TO THE CONTRACT.