B-144018, SEP. 29, 1960

B-144018: Sep 29, 1960

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO THE SECRETARY OF THE ARMY: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 16. IT MUST BE CONCLUDED THAT THE LOW BID IS COMPLETELY OUT OF LINE WITH THE GOVERNMENT'S ESTIMATE. - AND IT IS OBVIOUS THAT THE PRICE IS INCONSISTENT WITH THE VALUE OF THE PARTICULAR ARTICLE CALLED FOR. WE BELIEVE THERE IS SUBSTANTIATED THE CONTRACTING OFFICER'S OPINION THAT THE PRICE QUOTED BY THE KINSMAN OPTICAL COMPANY SHOULD HAVE PLACED HIM ON CONSTRUCTIVE NOTICE OF THE PROBABILITY OF AN ERROR IN THE BID AND. THE COMPANY SHOULD HAVE BEEN AFFORDED THE USUAL OPPORTUNITY TO VERIFY THE BID PRIOR TO AWARD. IN ADDITION TO THE ESTABLISHED FACT THAT AN ERROR WAS MADE. WHICH THE KINSMAN OPTICAL COMPANY STATES IS THE AMOUNT OF ITS INTENDED BID.

B-144018, SEP. 29, 1960

TO THE SECRETARY OF THE ARMY:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 16, 1960, WITH ENCLOSURES, FORWARDED IN BEHALF OF THE ASSISTANT SECRETARY OF THE ARMY FOR LOGISTICS, BY THE OFFICE OF THE DEPUTY CHIEF OF STAFF FOR LOGISTICS, REQUESTING OUR DECISION AS TO WHETHER THE PRICE OF THE KINSMAN OPTICAL COMPANY'S CONTRACT NO. 60-6472 (M) MAY BE AMENDED IN VIEW OF THE DISCLOSURE AFTER AWARD OF AN ERROR IN THE COMPANY'S RELATED BID.

THE KINSMAN OPTICAL COMPANY SUBMITTED THE LOW BID OF $0.905 EACH FOR THE 260 MAGNIFIERS SPECIFIED UNDER FRANKFORD ARSENAL'S REQUEST FOR PROPOSALS M -2237 AS AGAINST THE ONLY OTHER BID RECEIVED OF $11 EACH, WHICH INCLUDED $0.50 FOR PACKAGING, AND THE ARSENAL'S ESTIMATED UNIT PRICE OF $4.25. HENCE, IT MUST BE CONCLUDED THAT THE LOW BID IS COMPLETELY OUT OF LINE WITH THE GOVERNMENT'S ESTIMATE--- BASED ON A 1957 PURCHASE--- AND IT IS OBVIOUS THAT THE PRICE IS INCONSISTENT WITH THE VALUE OF THE PARTICULAR ARTICLE CALLED FOR. IN VIEW OF THIS, WE BELIEVE THERE IS SUBSTANTIATED THE CONTRACTING OFFICER'S OPINION THAT THE PRICE QUOTED BY THE KINSMAN OPTICAL COMPANY SHOULD HAVE PLACED HIM ON CONSTRUCTIVE NOTICE OF THE PROBABILITY OF AN ERROR IN THE BID AND, THEREFORE, THE COMPANY SHOULD HAVE BEEN AFFORDED THE USUAL OPPORTUNITY TO VERIFY THE BID PRIOR TO AWARD. MOREOVER, IN ADDITION TO THE ESTABLISHED FACT THAT AN ERROR WAS MADE, THE CONTRACTING OFFICER CERTIFIES THAT A FEDERAL SUPPLY SCHEDULE OF THE GENERAL SERVICES ADMINISTRATION SHOWS A LIST PRICE OF $9.50 EACH FOR THE MAGNIFIERS, WHICH THE KINSMAN OPTICAL COMPANY STATES IS THE AMOUNT OF ITS INTENDED BID.

ACCORDINGLY, THE UNIT PRICE OF CONTRACT NO. 60-6472 (M), UNDER WHICH DELIVERY HAS BEEN COMPLETED BUT NO PAYMENT MADE, MAY BE AMENDED TO READ $9.50 EACH IN LIEU OF $0.905 FOR THE MAGNIFIERS, IT BEING NOTED THAT THE INCREASED PRICE STILL WILL REPRESENT THE LOWEST BID RECEIVED.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE VOUCHER COVERING PAYMENT.

THE PAPERS, WITH THE EXCEPTION OF THE CONTRACTING OFFICER'S REPORT DATED AUGUST 19, 1960, IN THE MATTER, ARE RETURNED HEREWITH.