B-143271, OCT. 7, 1960

B-143271, OCT. 7, 1960

TO THE SECRETARY OF THE AIR FORCE:

BY LETTER DATED AUGUST 12, 1960, THE ASSISTANT DEPUTY FOR PROCUREMENT AND PRODUCTION FURNISHED A REPORT WITH RESPECT TO THE PROTEST OF MCGREGOR AND WERNER, INCORPORATED, AGAINST THE AWARD OF A CONTRACT TO THE GOODWAY PRINTING COMPANY UNDER INVITATION FOR BIDS NO. 49-642-60-58.

THE INVITATION ISSUED ON APRIL 29, 1960, BY THE BASE PROCUREMENT OFFICE, 1001ST AIR BASE WING, ANDREWS AIR FORCE BASE, REQUESTED BIDS FOR FURNISHING GRAPHIC ART SERVICES, PRINTING, BINDING AND DISTRIBUTION, AS MAY BE REQUIRED, FROM THE DATE OF RECEIPT OF THE SIGNED CONTRACT THROUGH JUNE 30, 1961. THE INSTRUCTIONS TO BIDDERS PROVIDED:

"NOTE 2. FORMAL ADVERTISEMENT: BIDS SUBMITTED AS A RESULT OF THIS INVITATION WILL BE EVALUATED IN ACCORDANCE WITH REGULATIONS PERTAINING TO FORMAL ADVERTISING. AWARD OF CONTRACTS SHALL BE IN ACCORDANCE WITH PARAGRAPH 7 OF THE SCHEDULE.'

"F. BID PRICES MUST BE SUBMITTED ON ALL ITEMS INCLUDED IN EXHIBIT A (SECTION 1 THRU 6). IN THE EVENT NO CHARGE IS TO BE MADE FOR AN ITEM "N/C" WILL BE INSERTED. BIDS NOT SO SUBMITTED WILL BE CONSIDERED NON- RESPONSIVE AND WILL BE REJECTED.'

PARAGRAPH 7 OF THE INVITATION SCHEDULE READ AS FOLLOWS:

"7. EVALUATION: THE PROPOSED PRICES SET FORTH BY THE BIDDER IN THE ATTACHED EXHIBIT A WILL BE EVALUATED IN THE MANNER ILLUSTRATED IN THE FOLLOWING EVALUATION FORMULA (QUANTITIES UTILIZED IN ACTUAL EVALUATION WILL BE IDENTICAL TO THOSE SET FORTH BELOW). (TO BE USED FOR EVALUATION PURPOSES ONLY IN DETERMINING LOWEST BID PRICE).'

THE EVALUATION FORMULA LISTED 45 BID ITEMS TO BE CONSIDERED IN DETERMINING THE LOWEST, RESPONSIVE BID, BUT DID NOT INCLUDE ALL OF THE ITEMS SET FORTH IN EXHIBIT "A" TO THE INVITATION WHICH CALLED FOR BID ITEM PRICES FOR EACH AND EVERY CATEGORY AND SUB-CATEGORY OF WORK. THE INVITATION CONTEMPLATED THAT AWARD WOULD BE MADE TO THE LOWEST AGGREGATE BIDDER UNDER THE EVALUATION FORMULA.

THREE BIDS WERE RECEIVED AND OPENED ON MAY 18, 1960, FROM MCGREGOR, GOODWAY AND THE FEDERAL LITHOGRAPH COMPANY. IT APPEARS FROM THE ABSTRACT OF BIDS THAT MCGREGOR SUBMITTED THE LOWEST AGGREGATE BID IN THE AMOUNT OF $47,547.49; THAT GOODWAY SUBMITTED THE NEXT LOWEST AGGREGATE BID IN THE AMOUNT OF $47,767.75, AND THAT FEDERAL'S BID WAS IN THE AGGREGATE AMOUNT OF $70,534.99. HOWEVER, IN COMPUTING THE BID PRICE EXTENSIONS, IT WAS NOTED BY THE CONTRACTING OFFICER THAT THERE WAS A DISPARITY IN BID PRICES ON EIGHT ITEMS OF THE EVALUATION FORMULA. THE CONTRACTING OFFICER THEREUPON REQUESTED THE THREE BIDDERS TO VERIFY THEIR PRICES ON SUCH ITEMS. BOTH GOODWAY AND FEDERAL ALLEGED ERRORS IN THEIR BIDS BUT MCGREGOR CONFIRMED ITS BID PRICES. HOWEVER, UPON A COMPLETE REVIEW OF MCGREGOR'S BID IT WAS DISCOVERED THAT IT HAD FAILED TO BID ON THE ITEMS COVERED BY SECTION 4, ITEM III, PARAGRAPH 2 B. OF EXHIBIT "A.' THESE ITEMS WERE NOT TO BE CONSIDERED IN DETERMINING THE LOW BIDDER. MCGREGOR WAS CONTACTED IN THIS REGARD AND ADVISED THAT IT HAD INTENDED TO BID "NO CHARGE" FOR THIS ITEM. IN VIEW OF PARAGRAPH F OF THE INSTRUCTIONS TO BIDDERS, THE MCGREGOR BID WAS REJECTED AS NONRESPONSIVE. UPON THE BASIS OF THE EVIDENCE FURNISHED BY GOODWAY ESTABLISHING ITS INTENDED BID PRICES ON FOUR ITEMS ON THE SCHEDULE, ITS AGGREGATE BID PRICE WAS ADJUSTED DOWNWARD TO $46,694.75 AND AWARD WAS MADE TO THAT BIDDER ON JULY 1, 1960, IN THE ESTIMATED AMOUNT OF $90,000.

THE BASES OF THE MCGREGOR PROTEST ARE THAT IT WAS IMPROPER TO REJECT ITS BID BECAUSE OF THE FAILURE TO INSERT A "NO CHARGE" FOR THE ITEM COVERED BY SECTION 4, ITEM III, PARAGRAPH 2 B. OF EXHIBIT "A," AND THAT THE ADMINISTRATIVE CORRECTION OF GOODWAY'S OTHERWISE HIGH AGGREGATE BID TO ONE BELOW THAT BID BY MCGREGOR IN THE AGGREGATE WAS ALSO IMPROPER.

WE BELIEVE THAT THE AWARD OF THIS "CALL-TYPE" CONTRACT TO GOODWAY WAS IMPROPER AND THAT THE REJECTION OF MCGREGOR'S BID WAS NOT REQUIRED UNDER THE TERMS OF THE INVITATION.

THE INVITATION, WHILE PROVIDING THAT ALL ITEMS INCLUDED IN EXHIBIT "A" MUST BE BID UPON OR AN ,NC" INSERTED WITH THE ADMONITION THAT FAILURE TO DO SO WILL RESULT IN THE REJECTION OF THE BID, PRESCRIBED A DEFINITE FORMULA FOR EVALUATING BIDS IN THE AGGREGATE WHEREIN ONLY SELECTED BID ITEMS WERE INCLUDED TO THE EXCLUSION OF OTHERS. SINCE SUCH PROVISION IN PARAGRAPH F OF THE INSTRUCTIONS TO BIDDERS PRESCRIBED A CRITERION OF RESPONSIVENESS TO BE USED IN THE EVALUATION OF BIDS, IT MUST OF NECESSITY BE RELATED TO THE EVALUATION FORMULA WHICH DELINEATED THE BID ITEMS TO BE CONSIDERED IN DETERMINING THE LOWEST, RESPONSIVE AGGREGATE BIDDER. WE DO NOT BELIEVE THAT A BID ITEM DELIBERATELY EXCLUDED BY THE PROCUREMENT AGENCY FROM THE EVALUATION FORMULA WAS SUCH A MATERIAL PART OF A BID AS TO REQUIRE ITS SUMMARY REJECTION BECAUSE OF THE FAILURE TO INSERT A "NO CHARGE" FOR THAT ITEM. IT CANNOT BE SAID THAT THE ITEM IN QUESTION WENT TO THE SUBSTANCE OF MCGREGOR'S BID WITHIN THE PURVIEW OF THE RULE LAID DOWN IN 30 COMP. GEN. 179. WE UNDERSTAND INFORMALLY, AND AS INDICATED IN THE CONTRACTING OFFICER'S STATEMENT OF FACTS, THAT THE PROCUREMENT OFFICE HAS NEVER ORDERED THE SERVICES UNDER THE ITEM COVERED BY SECTION 4, ITEM III, PARAGRAPH 2 B. OF EXHIBIT "A" AND THAT ONLY A REMOTE POSSIBILITY EXISTS THAT SUCH SERVICES WILL BE REQUIRED DURING THE CURRENT FISCAL YEAR. WE NOTE THAT ONLY 45 ITEMS OUT OF OVER 100 ITEMS LISTED ON EXHIBIT "A" WERE INCLUDED IN THE EVALUATION FORMULA. THIS CLEARLY INDICATES TO US THAT THE REMAINING ITEMS WERE NOT FOR CONSIDERATION IN DETERMINING THE LOWEST, RESPONSIVE AGGREGATE BIDDER. THE FAILURE TO BID ON SUCH AN ISOLATED, INCONSEQUENTIAL ITEM DOES NOT, IN OUR OPINION, REQUIRE THE REJECTION OF AN OTHERWISE RESPONSIVE LOW BID UNDER PARAGRAPH F. IN EFFECT, APPLICATION OF THAT PARAGRAPH TO THE BID OF MCGREGOR IMPOSED AN EVALUATION FACTOR NOT CONTEMPLATED BY THE INVITATION. ACCORDINGLY, IT IS OUR VIEW THAT THE LOW BID OF MCGREGOR WAS IMPROPERLY REJECTED.

INASMUCH AS MCGREGOR WAS THE LOWEST RESPONSIVE BIDDER WE THINK THAT THE DOWNWARD CORRECTION OF GOODWAY'S BID TO CORRECT ERRORS SUSPECTED BY THE CONTRACTING OFFICER WAS NOT AUTHORIZED UNDER THE ASPR OR DECISIONS OF OUR OFFICE. SECTION 2-405.2 OF THE ASPR (NOW SECTION 2 406.3) AUTHORIZES THE MILITARY DEPARTMENTS TO DETERMINE THAT A MISTAKE IN BID SHOULD BE CORRECTED WHEN CLEAR AND CONVINCING EVIDENCE ESTABLISHES BOTH THE EXISTENCE OF THE MISTAKES AND THE INTENDED BID, PROVIDED THAT SUCH DETERMINATION SHOULD NOT BE MADE IN THE EVENT SUCH CORRECTION WOULD RESULT IN DISPLACING ONE OR MORE LOWER BIDS UNLESS THE EXISTENCE OF THE MISTAKE AND THE BID ACTUALLY INTENDED ARE ASCERTAINABLE SUBSTANTIALLY FROM THE INVITATION AND THE BID ITSELF. SEE, IN THAT CONNECTION, 37 COMP. GEN. 210.

WE, THEREFORE, ARE OF THE OPINION THAT CORRECTION OF GOODWAY'S SECOND-LOW BID DOWNWARD WAS IMPROPER AND PREJUDICIAL TO THE RIGHTS OF THE OTHERWISE RESPONSIVE LOW BIDDER.

ACCORDINGLY, THE CONTRACT AWARDED TO THE GOODWAY PRINTING COMPANY SHOULD BE CANCELLED AND AWARD SHOULD BE MADE TO MCGREGOR AND WERNER, INCORPORATED, FOR THE REMAINING CONTRACT SERVICES THROUGH JUNE 30, 1961.