B-141332, DEC. 4, 1959

B-141332: Dec 4, 1959

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UNITED STATES TREASURY DEPARTMENT: REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 25. IT IS THE CUSTOM OF THE INTERNAL REVENUE SERVICE TO SUPPLY SAMPLES FROM PREVIOUS ORDERS. THAT IN THE SUBJECT INVITATION THE SAMPLES WERE MARKED "SAMPLE FOR CONSTRUCTION AND TYPE COVERAGE. THAT THE TWO INSIDE PARTS OF THE SAMPLE ARE FURTHER FASTENED WITH ONE WIRE STAPLE IN THE RIGHT MARGIN. IT IS STATED FURTHER THAT AUTOGRAPHIC SUBMITTED SAMPLES WITH A 3/8 INCH HOLE IN THE RIGHT-HAND MARGIN OF PART 1 AND PART 4. WHICH HOLE IS FOR THE PURPOSE OF COLLATING AND STITCHING THE ENTIRE ASSEMBLY IN ONE OPERATION. IT HAS NOT BEEN APPROVED BY THE SERVICE AND IS NOT IN ACCORDANCE WITH SPECIFICATIONS. IT IS STATED THAT AUTOGRAPHIC QUALIFIED ITS BID WITH THE NOTATION "OUR BID IS BASED ON CONSTRUCTION.

B-141332, DEC. 4, 1959

TO MR. JAMES J. MURRAY, ACTING CONTRACTING OFFICER, UNITED STATES TREASURY DEPARTMENT:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 25, 1959, WITH ENCLOSURES, REQUESTING A DECISION AS TO THE APPROPRIATE ACTION TO BE TAKEN WITH RESPECT TO THE BID SUBMITTED BY AUTOGRAPHIC BUSINESS FORMS, INC., UNDER INVITATION FOR BIDS NO. 12/FY-60).

BY THE INVITATION REFERRED TO, THE TREASURY DEPARTMENT, INTERNAL REVENUE SERVICE, REQUESTED BIDS FOR THE PRODUCTION OF 3,700,000 COPIES OF FORM TY ITEM 69, A MARGINALLY PUNCHED ASSEMBLY AS SPECIFIED IN THE INVITATION. RESPONSE AUTOGRAPHIC BUSINESS FORMS, INC. (HEREINAFTER REFERRED TO AS AUTOGRAPHIC) SUBMITTED THE LOWEST BID ON THE FORMS IN THE AMOUNT OF $39,146, AND THE STANDARD REGISTER COMPANY SUBMITTED THE NEXT LOWEST BID THEREON IN THE AMOUNT OF $42,365.

YOU STATE THAT TO ASSIST CONTRACTORS TO FULLY UNDERSTAND THE SERVICE'S OFFERINGS, IT IS THE CUSTOM OF THE INTERNAL REVENUE SERVICE TO SUPPLY SAMPLES FROM PREVIOUS ORDERS; THAT IN THE SUBJECT INVITATION THE SAMPLES WERE MARKED "SAMPLE FOR CONSTRUCTION AND TYPE COVERAGE," AND SHOW A 4-PART SET WITH ALL PARTS FASTENED WITH TWO WIRE STAPLES IN THE LEFT MARGIN; AND THAT THE TWO INSIDE PARTS OF THE SAMPLE ARE FURTHER FASTENED WITH ONE WIRE STAPLE IN THE RIGHT MARGIN. IT IS STATED FURTHER THAT AUTOGRAPHIC SUBMITTED SAMPLES WITH A 3/8 INCH HOLE IN THE RIGHT-HAND MARGIN OF PART 1 AND PART 4, WHICH HOLE IS FOR THE PURPOSE OF COLLATING AND STITCHING THE ENTIRE ASSEMBLY IN ONE OPERATION; AND THAT WHILE THIS TYPE OF CONSTRUCTION SAVES A COLLATING OPERATION, IT HAS NOT BEEN APPROVED BY THE SERVICE AND IS NOT IN ACCORDANCE WITH SPECIFICATIONS. ALSO, IT IS STATED THAT AUTOGRAPHIC QUALIFIED ITS BID WITH THE NOTATION "OUR BID IS BASED ON CONSTRUCTION, PER SAMPLE ATTACHED" AND THAT UPON BEING INFORMED THAT ITS CONSTRUCTION SAMPLE DID NOT MEET THE SPECIFICATIONS AND THAT ITS BID COULD NOT BE CONSIDERED, THE CORPORATION STATED THAT IT WOULD REMOVE THE QUALIFICATION FROM ITS BID AND MANUFACTURE THE ORDER IN ACCORDANCE WITH THE SPECIFICATIONS AND THE SERVICE'S CONSTRUCTION SAMPLE AT THE PRICE QUOTED IN ITS BID. YOU POINT OUT THAT AN ACCEPTANCE OF THE OFFER OF AUTOGRAPHIC TO WITHDRAW ITS QUALIFICATION WOULD RESULT IN A SAVINGS OF $3,219 TO THE GOVERNMENT.

IT IS OUR OPINION THAT TO WAIVE THE QUALIFICATION IN THE BID OF AUTOGRAPHIC BUSINESS FORMS, INC. AFTER SUCH QUALIFICATION HAD BEEN PREVIOUSLY DETERMINED AS A BASIS FOR REJECTION OF ITS BID, WOULD IN EFFECT BE GIVING CONSIDERATION TO A NEW BID SUBMITTED AFTER THE BIDS WERE OPENED IN VIOLATION OF THE SPIRIT AND PURPOSE OF THE STATUTES RELATING TO COMPETITIVE BIDDING. REINSTATEMENT OF AUTOGRAPHIC'S BID AFTER BID OPENING FOR CONSIDERATION UPON A BASIS DIFFERENT FROM THAT UPON WHICH IT WAS ORIGINALLY SUBMITTED AND EVALUATED WOULD BE CLEARLY PREJUDICIAL TO OTHER BIDDERS. SEE 37 COMP. GEN. 645, 648.

IN CITY OF CHICAGO V. MOHR, 216 ILL. 320, 74 N.E. 1056, IT WAS SAID:

" * * * WHEN A BID IS PERMITTED TO BE CHANGED (AFTER THE OPENING) IT IS NO LONGER THE SEALED BID SUBMITTED IN THE FIRST INSTANCE, AND, TO SAY THE LEAST, IS FAVORITISM, IF NOT FRAUD--- A DIRECT VIOLATION OF THE LAW--- AND CANNOT BE TOO STRONGLY CONDEMNED.'

AS POINTED OUT IN 17 COMP. GEN. 554, THE STRICT MAINTENANCE OF THE COMPETITIVE BIDDING PROCEDURES REQUIRED BY LAW IS INFINITELY MORE IN THE PUBLIC INTEREST THAN OBTAINING A PECUNIARY ADVANTAGE IN INDIVIDUAL CASES BY PERMITTING PRACTICES WHICH DO VIOLENCE TO THE SPIRIT AND PURPOSE OF THE LAW. CONDITIONS OR RESERVATIONS WHICH GIVE A BIDDER A CHANCE TO SECOND- GUESS HIS COMPETITORS AFTER BID OPENING MUST BE REGARDED AS FATAL TO THE BID.

ACCORDINGLY, WE CONCLUDE THAT THE BID OF AUTOGRAPHIC BUSINESS FORMS, INC., UNDER THE INSTANT INVITATION, MUST BE REJECTED AND MAY NOT BE CONSIDERED FOR AWARD.