B-142381, MAY 16, 1960, 39 COMP. GEN. 774

B-142381: May 16, 1960

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WOULD BE TANTAMOUNT TO RESERVING TO THE BIDDER THE RIGHT TO MODIFY HIS BID WITH RESPECT TO TRANSPORTATION RATES AFTER BID OPENING AND CONTRARY TO PROPER PROCUREMENT PRACTICES WHICH REQUIRE TRANSPORTATION COSTS TO BE EVALUATED ON THE BASIS OF THE RATES ACTUALLY FILED AND PUBLISHED AT THE TIME THE BIDS ARE OPENED. 1960: REFERENCE IS MADE TO LETTER OF MARCH 24. IT IS THE CONTENTION OF YOUR ATTORNEY. IS IN VIOLATION OF THE TERMS OF THE ABOVE INVITATION AND ESTABLISHED PROCUREMENT PROCEDURES. PROSPECTIVE BIDDERS WERE APPRISED THAT ALL BIDS WOULD BE EVALUATED ON THE BASIS OF THE BID PRICE PLUS THE GOVERNMENT'S DETERMINATION OF THE MOST ECONOMICAL MODE OF COMMERCIAL TRANSPORTATION. EACH BIDDER WAS REQUIRED TO STATE THE GUARANTEED SHIPPING WEIGHT.

B-142381, MAY 16, 1960, 39 COMP. GEN. 774

BIDS - EVALUATION - DELIVERY COSTS - REDUCED RATES FILED AFTER BID OPENING AN EVALUATION OF BIDS ON THE BASIS OF DRIVEWAY DELIVERY RATES WHEN THE INVITATION, WHICH PROVIDED THAT BIDS WOULD BE EVALUATED ON THE BASIS OF THE MOST ECONOMICAL MODE OF COMMERCIAL TRANSPORTATION, SPECIFICALLY REQUIRED BIDDERS TO INCLUDE THE COST OF LOADING, BLOCKING, AND BRACING THE ITEMS ON A CARRIER'S FACILITY WOULD BE AN EVALUATION ON A BASIS NOT CONTEMPLATED BY THE INVITATION AND CONTRARY TO SOUND PROCUREMENT PROCEDURES. TO PERMIT A BIDDER AFTER BID OPENING TO OFFER TO SHIP THE EQUIPMENT BY A MOTOR CARRIER WHO HAD THEN TENDERED A REDUCED TRANSPORTATION RATE UNDER A SECTION 22 QUOTATION, 49 U.S.C. 22, WOULD BE TANTAMOUNT TO RESERVING TO THE BIDDER THE RIGHT TO MODIFY HIS BID WITH RESPECT TO TRANSPORTATION RATES AFTER BID OPENING AND CONTRARY TO PROPER PROCUREMENT PRACTICES WHICH REQUIRE TRANSPORTATION COSTS TO BE EVALUATED ON THE BASIS OF THE RATES ACTUALLY FILED AND PUBLISHED AT THE TIME THE BIDS ARE OPENED.

TO THE LEACH COMPANY, MAY 16, 1960:

REFERENCE IS MADE TO LETTER OF MARCH 24, 1960, WITH ENCLOSURES, AND TO SUBSEQUENT CORRESPONDENCE FROM JAMES J. HANKS, ATTORNEY, PROTESTING ON YOUR BEHALF AGAINST THE AWARD OF A CONTRACT TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS NO. DA-ENG-11-184-60-A-388, ISSUED BY THE DEPARTMENT OF THE ARMY, CORPS OF ENGINEERS PROCUREMENT OFFICE, CHICAGO, ILLINOIS, COVERING 102 REFUSE TRUCKS. IT IS THE CONTENTION OF YOUR ATTORNEY, IN SUBSTANCE, THAT FAILURE OR REFUSAL ON THE PART OF THE CONTRACTING OFFICER TO USE CERTAIN SPECIALLY OFFERED " DRIVEAWAY" RATES APPLICABLE TO YOUR EQUIPMENT, FOR BID EVALUATION PURPOSES, IS IN VIOLATION OF THE TERMS OF THE ABOVE INVITATION AND ESTABLISHED PROCUREMENT PROCEDURES.

THE RECORD DISCLOSES THAT IN THE SAID INVITATION, WHICH SOUGHT QUOTATIONS FROM 15 POTENTIAL MANUFACTURES OF THE SPECIFIED EQUIPMENT, PROSPECTIVE BIDDERS WERE APPRISED THAT ALL BIDS WOULD BE EVALUATED ON THE BASIS OF THE BID PRICE PLUS THE GOVERNMENT'S DETERMINATION OF THE MOST ECONOMICAL MODE OF COMMERCIAL TRANSPORTATION. EACH BIDDER WAS REQUIRED TO STATE THE GUARANTEED SHIPPING WEIGHT, AND TO AGREE TO REIMBURSE THE GOVERNMENT FOR ANY INCREASED TRANSPORTATION COSTS IF THE ACTUAL SHIPPING WEIGHT EXCEEDED THE WEIGHT LISTED IN THE BID. ALSO, BIDDERS WERE REQUIRED TO SHOW THEIR RESPECTIVE F.O.B. SHIPPING POINTS AND TO INCLUDE IN THE UNIT PRICE QUOTED THEIR COSTS FOR FURNISHING THE COMPLETED UNIT F.O.B. CARRIER'S EQUIPMENT, RAIL OR OTHER THAN RAIL AT GOVERNMENT'S OPTION, LOADED, BLOCKED, AND BRACED. THE TERMS OF THE INVITATION, ALL OF WHICH ARE TO BE INCORPORATED INTO THE ULTIMATE CONTRACT, ALSO STIPULATED THAT THE UNITS WOULD BE TRANSPORTED TO DESTINATION ON A GOVERNMENT BILL OF LADING, AND THAT SHIPPING INSTRUCTIONS WOULD BE ISSUED AFTER AWARD IS MADE.

WHILE THE INVITATION STATES IN GENERAL TERMS THAT DETERMINATION OF THE LOW BIDDER WOULD BE MADE ON THE BASIS OF THE MOST ECONOMICAL MODE OF COMMERCIAL TRANSPORTATION, IT SEEMS APPARENT TO US THAT THE SPECIFIC LANGUAGE "LOADED, BLOCKED, AND BRACED" USED IN THE OTHER CONDITIONS THEREOF CLEARLY INDICATED THAT "DRIVEWAY" DELIVERY WAS NOT CONTEMPLATED. CONCEDING THAT SUCH METHOD OF TRANSPORTATION MAY BE "THE MOST ECONOMICAL MODE OF COMMERCIAL TRANSPORTATION," WE FEEL THAT THIS LANGUAGE APPLIES ONLY TO THOSE METHODS CONTEMPLATED UNDER THE TERMS OF THE INVITATION. REQUIRE BIDDERS TO INCLUDE IN THEIR BID PRICE THE COST OF LOADING, BLOCKING, AND BRACING THE UNITS ON A CARRIER'S FACILITY, AND THEN TO EVALUATE BIDS ON DRIVEAWAY RATES, WOULD BE CONTRARY TO SOUND PROCUREMENT PROCEDURES. HOWEVER, IN THAT CONNECTION THE RECORD SHOWS THAT EVEN IF DRIVEAWAY RATES PUBLISHED PRIOR TO BID OPENING WERE USED IN SUCH EVALUATION YOUR BID WOULD NOT BE THE LOWEST.

WITH RESPECT TO THE CONTENTION THAT THE REDUCED OF THE KENOSHA AUTO TRANSPORT CORPORATION, OFFERED SPECIALLY FOR THIS TRANSACTION UNDER SECTION 22 (1) OF THE INTERSTATE COMMERCE ACT OF 1887, 49 U.S.C. 22, SHOULD BE USED IN THE EVALUATION OF YOUR BID, WE AGREE WITH THE REQUIREMENT IN APP 1-306.52C (2) THAT SUCH RATES MUST BE AVAILABLE FOR EVALUATION AT THE TIME THE BIDS ARE OPENED. TO PERMIT YOUR SHOPPING FOR SPECIAL RATES AFTER OPENING OF BIDS WOULD, WE BELIEVE, BE INCONSISTENT WITH COMPETITIVE BIDDING REQUIREMENTS, AND QUITE OBVIOUSLY WOULD RESULT IN NO END OF CONFUSION. FOR THAT REASON, UNDER APPLICABLE REGULATIONS, ONLY RATES ON FILE AT THE TIME OF BID OPENING MAY BE USED IN THE EVALUATION OF THE BIDS RECEIVED. NO PRINCIPLE IS MORE FIRMLY ROOTED IN THE DECISIONS OF THIS OFFICE THAN THE RULE THAT A BIDDER MAY NOT, AFTER BIDS ARE OPENED, OFFER ANY AMENDMENT OR MODIFICATION OF THE PRICE OR OTHER TERMS OF HIS BID WHICH WOULD AFFECT HIS STANDING WITH RESPECT TO OTHER BIDDERS. INSEPARABLE FROM THIS RULE IS THE REQUIREMENT THAT BIDS ARE GENERALLY TO BE EVALUATED AS OF THE TIME OF OPENING. WHILE TRANSPORTATION COSTS MAY BE CALCULATED ON THE BASIS OF RATES TO BE EFFECTIVE AT THE TIME OF SHIPMENT, SUCH RATES MUST HAVE BEEN ACTUALLY FILED OR PUBLISHED AT THE TIME OF EVALUATION. SEE 35 COMP. GEN. 603. WHILE IT IS TRUE THAT IN THIS INSTANCE THE KENOSHA AUTO TRANSPORT CORPORATION WAS NOT ITSELF A BIDDER ON THE CONTRACT, WE MUST ASSUME THAT ITS OFFER OF A SECTION 22 RATE WAS SOLICITED BY YOU, AND WOULD NOT HAVE BEEN MADE EXCEPT AS AN INDUCEMENT FOR THE AWARD OF A CONTRACT TO YOU. BY WAITING UNTIL BIDS WERE OPENED BEFORE PROCURING THE OFFER OF THE TRANSPORT COMPANY, YOU IN EFFECT RESERVED TO YOURSELF AN OPTION EITHER TO ACT OR TO REFRAIN FROM ACTING IN THAT RESPECT, AND TO CONSIDER THAT OFFER IN THE EVALUATION OF BIDS WOULD BE TO GIVE EFFECT TO A MODIFICATION IN FACT OBTAINED BY YOU AFTER BID OPENING.

WE ARE COGNIZANT OF THE SEVERAL DECISIONS HERETOFORE RENDERED BY THIS OFFICE WHICH ARE CITED BY YOUR ATTORNEY IN SUPPORT OF HIS POSITION; HOWEVER, WE DO NOT FIND THAT THE PRINCIPLES ENUNCIATED THEREIN ARE APPLICABLE TO THE CONTROVERSY HERE INVOLVED.

SINCE YOUR BID WOULD NOT BE THE LOWEST ON A PROPER EVALUATION OF TRANSPORTATION COSTS EITHER BY RAIL OR BY DRIVEAWAY, THE PROTEST OF YOUR ATTORNEY FURNISHES NO PROPER BASIS ON WHICH WE WOULD BE JUSTIFIED IN QUESTIONING THE PROPOSED ACTION OF THE PROCURING AGENCY.