B-142478, MAY 19, 1960

B-142478: May 19, 1960

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VETERANS ADMINISTRATION: REFERENCE IS MADE TO A LETTER DATED APRIL 1. IS BASED. THE DECISION IS BEING ADDRESSED TO YOU. ITEM 9 WAS ACCEPTED BY PURCHASE ORDER 60 SO-50442 ISSUED JANUARY 29. THE CONTRACTOR CLAIMED THAT THE BID ON ITEM 9 WAS IN ERROR AND SHOULD HAVE BEEN $44.95 PER DRUM. THE CONTRACTOR SUBMITTED A WORKSHEET WHICH INDICATES THAT THE BID PRICES ON ITEMS 8 AND 9 WERE BASED ON THE COST OF MATERIALS FOR FIVE GALLONS OF SOAP. - WAS LESS THAN 2 1/2 TIMES ITS BID OF $8.46 PER 5 GALLON DRUM OF THE SAME MATERIAL DELIVERED AT THE SAME DESTINATION UNDER ITEM 7. IT WOULD APPEAR THAT A REQUEST FOR VERIFICATION OF THE BID WOULD HAVE BEEN IN ORDER BEFORE ACCEPTANCE.

B-142478, MAY 19, 1960

TO HONORABLE SUMNER G. WHITTIER, ADMINISTRATOR, VETERANS ADMINISTRATION:

REFERENCE IS MADE TO A LETTER DATED APRIL 1, 1960, WITH ENCLOSURES, FILE REFERENCE, 134C1, FROM ROY A. WALFORD, DEPUTY CHIEF MEDICAL DIRECTOR, DEPARTMENT OF MEDICINE AND SURGERY, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR GENERAL LABORATORIES ALLEGES IT MADE IN ITS BID ON WHICH UNNUMBERED CONTRACT DATED JANUARY 29, 1960, IS BASED.

SINCE AN AWARD HAS BEEN MADE IN THE PRESENT CASE, THE DECISION IS BEING ADDRESSED TO YOU. SEE 26 COMP. GEN. 993; AND 28 ID. 401.

BY INVITATION M5-54-60, THE VETERANS ADMINISTRATION, MARKETING DIVISION FOR DRUGS AND CHEMICALS, VA SUPPLY DEPOT, SOMERVILLE, NEW JERSEY, SOLICITED BIDS ON HEXACHLOROPHENE LIQUID SOAP CONCENTRATE IN 5 GALLON DRUMS, ITEMS 5, 6, AND 7, AND IN 30-GALLON DRUMS, ITEMS 8 AND 9. GENERAL LABORATORIES OF PHILADELPHIA, PENNSYLVANIA, BID $29.36 PER 30-GALLON DRUM ON ITEM 8 WHICH CALLED FOR 20 DRUMS FOR DELIVERY TO WILMINGTON, CALIFORNIA, AND $20.62 PER DRUM ON ITEM 9, COVERING 50 DRUMS FOR HINES, ILLINOIS. ITEM 9 WAS ACCEPTED BY PURCHASE ORDER 60 SO-50442 ISSUED JANUARY 29, 1960.

AFTER AWARD HAD BEEN MADE, THE CONTRACTOR CLAIMED THAT THE BID ON ITEM 9 WAS IN ERROR AND SHOULD HAVE BEEN $44.95 PER DRUM. IN SUPPORT OF THE ALLEGED ERROR, THE CONTRACTOR SUBMITTED A WORKSHEET WHICH INDICATES THAT THE BID PRICES ON ITEMS 8 AND 9 WERE BASED ON THE COST OF MATERIALS FOR FIVE GALLONS OF SOAP, AS COMPUTED FOR THEIR BIDS ON ITEMS 5, 6, AND 7, RATHER THAN 30 GALLONS. THE OTHER BIDS ON ITEM 9 RANGED FROM $31 TO $49.50 PER 30-GALLON DRUM.

EXAMINATION OF THE ABSTRACT OF BIDS SHOWS THAT THE BID OF GENERAL LABORATORIES ON ITEM 9--- $20.62 PER 30-GALLON DRUM DELIVERED AT HINES, ILLINOIS--- WAS LESS THAN 2 1/2 TIMES ITS BID OF $8.46 PER 5 GALLON DRUM OF THE SAME MATERIAL DELIVERED AT THE SAME DESTINATION UNDER ITEM 7. ALL 10 OTHER BIDDERS ON THE SAME ITEMS QUOTED PRICES FOR 30-GALLON DRUMS MORE THAN FIVE TIMES THEIR PRICES FOR 5-GALLON DRUMS. IN THE CIRCUMSTANCES, AND IN VIEW OF THE SUBSTANTIAL DIFFERENCE BETWEEN THE BID OF THE CONTRACTOR ON ITEM 9 AND THE OTHER BIDS FOR THIS ITEM, IT WOULD APPEAR THAT A REQUEST FOR VERIFICATION OF THE BID WOULD HAVE BEEN IN ORDER BEFORE ACCEPTANCE.

ACCORDINGLY, THE PURCHASE ORDER MAY BE CANCELED. A REFERENCE TO THIS DECISION SHOULD BE MADE IN THE PURCHASE ORDER INVOLVED.