B-144756, MAR. 28, 1961

B-144756: Mar 28, 1961

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TO STROM MACHINERY CORPORATION: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 3. THREE BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. ALTHOUGH YOUR BID WAS THE HIGHEST RECEIVED. IT IS REPORTED ALSO THAT SHORTLY AFTER THE OPENING OF BIDS THE GENERAL SERVICES ADMINISTRATION WAS ADVISED BY THE DEPARTMENT OF DEFENSE OF A NEED FOR CERTAIN PRESSES AND EQUIPMENT WHICH WERE AVAILABLE AT THE ADRIAN PLANT. IN VIEW OF THE INADEQUACY OF THE BIDS RECEIVED AND OF THE REQUEST FROM THE DEPARTMENT OF DEFENSE FOR EQUIPMENT WHICH WAS AVAILABLE IN THE PLANT. THE BIDS WERE REJECTED ON DECEMBER 21. IT CONSISTENTLY HAS BEEN HELD THAT THE QUESTION WHETHER ALL BIDS SHOULD BE REJECTED IS FOR ADMINISTRATIVE DETERMINATION AND WILL NOT BE QUESTIONED BY THIS OFFICE IN THE ABSENCE OF A SHOWING OF BAD FAITH.

B-144756, MAR. 28, 1961

TO STROM MACHINERY CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 3, 1961, WITH ENCLOSURES, IN CONNECTION WITH THE REJECTION BY THE GENERAL SERVICE ADMINISTRATION OF ALL BIDS RECEIVED FOR AIR FORCE PLANT NO. 60 AT ADRIAN, MICHIGAN (D-MICH-514).

THE INVITATION FOR BIDS CONTAINED A DESCRIPTION OF THE PROPERTY OFFERED AND TERMS AND CONDITIONS OF THE SALE. PARAGRAPH 3 OF THE GENERAL TERMS AND CONDITIONS, ATTACHED TO THE INVITATION, PROVIDES, IN PART, THAT THE CONDITIONS, ATTACHED TO THE INVITATION, PROVIDES, IN PART, THAT THE GOVERNMENT RESERVES THE RIGHT TO REJECT ANY AND ALL BIDS.

THREE BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. ALTHOUGH YOUR BID WAS THE HIGHEST RECEIVED, IT DID NOT COME UP TO THE APPRAISED FAIR MARKET VALUE OF THE PLAN AS APPROVED BY THE GENERAL SERVICES ADMINISTRATION. IT IS REPORTED ALSO THAT SHORTLY AFTER THE OPENING OF BIDS THE GENERAL SERVICES ADMINISTRATION WAS ADVISED BY THE DEPARTMENT OF DEFENSE OF A NEED FOR CERTAIN PRESSES AND EQUIPMENT WHICH WERE AVAILABLE AT THE ADRIAN PLANT.

IN VIEW OF THE INADEQUACY OF THE BIDS RECEIVED AND OF THE REQUEST FROM THE DEPARTMENT OF DEFENSE FOR EQUIPMENT WHICH WAS AVAILABLE IN THE PLANT, THE GENERAL SERVICES ADMINISTRATION DETERMINED THAT IT WOULD BE IN THE BEST INTERESTS OF THE GOVERNMENT TO REJECT ALL BIDS. THE BIDS WERE REJECTED ON DECEMBER 21, 1960.

IT CONSISTENTLY HAS BEEN HELD THAT THE QUESTION WHETHER ALL BIDS SHOULD BE REJECTED IS FOR ADMINISTRATIVE DETERMINATION AND WILL NOT BE QUESTIONED BY THIS OFFICE IN THE ABSENCE OF A SHOWING OF BAD FAITH. WITH RESPECT TO YOUR CONTENTION THAT YOU SHOULD HAVE BEEN PERMITTED TO INCREASE THE AMOUNT OF YOUR BID IN ACCORDANCE WITH GSA ORDER ADM 4055.3, DATED JULY 27, 1960, AS YOU WERE ADVISED BY THE GSA, SUCH PROCEDURE IS FOR ITS INTERNAL GUIDANCE IN CIRCUMSTANCES WHICH, IN THEIR OPINION, INDICATE THAT SUCH ACTION WOULD BE ADVISABLE. SINCE IT APPEARS THAT THE ADMINISTRATIVE DETERMINATION TO REJECT ALL BIDS IN THE INTEREST OF THE GOVERNMENT WAS MADE IN GOOD FAITH, THERE IS NO BASIS FOR US TO QUESTION THE ACTION TAKEN.

AS YOU ARE AWARE, THE PROPERTY WAS AGAIN OFFERED FOR SALE TO THE GENERAL PUBLIC WITHOUT ANY RESTRICTIONS AS TO USE. THIS TIME, BIDS WERE REQUESTED ON AN ALTERNATE BASIS CONSISTING OF (1) THE ENTIRE PLANT INCLUDING ALL MACHINERY AND EQUIPMENT, AND (2) THE ENTIRE PLANT INCLUDING ALL OF THE MACHINERY AND EQUIPMENT EXCEPT THOSE ITEMS NEEDED BY THE DEPARTMENT OF DEFENSE. THE BIDS RECEIVED IN RESPONSE THERETO ARE NOW BEING CONSIDERED BY THE GENERAL SERVICES ADMINISTRATION.