B-146484, AUG. 2, 1961

B-146484: Aug 2, 1961

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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION: REFERENCE IS MADE TO LETTER OF JULY 20. BECAUSE OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. NAS3-1762 WAS AWARDED TO THE SAID FIRM FOR ITEMS 2 (A). THE CONTRACTOR NOTIFIED THE PROCUREMENT AUTHORITIES THAT ITS QUOTATIONS WERE BASED ON ITS ESTIMATED LABOR COSTS ONLY. BASED ON THE FOREGOING ITS INTENDED OFFER SHOULD HAVE BEEN $4. THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR. SHOULD HAVE REQUESTED THE BIDDER TO CONFIRM SUCH OFFER. IT IS APPARENT FROM THE RECORD THAT FAILURE TO DETECT THE ERROR INDICATED BY THE DISPARITY IN THE PRICES WAS AN OVERSIGHT ON THE PART OF THE PROCUREMENT OFFICIALS.

B-146484, AUG. 2, 1961

TO ADMINISTRATOR, NATIONAL AERONAUTICS AND SPACE ADMINISTRATION:

REFERENCE IS MADE TO LETTER OF JULY 20, 1961, WITH ENCLOSURES, FILE REFERENCE BRR:JMC, FROM THE DIRECTOR, PROCUREMENT AND SUPPLY, SUBMITTING FOR OUR CONSIDERATION AND DECISION THE QUESTION WHETHER THERE MAY BE GRANTED THE RELIEF REQUESTED BY ROCKY MOUNTAIN INSTRUMENT COMPANY, BECAUSE OF AN ERROR ALLEGED TO HAVE BEEN MADE IN ITS BID SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. C-1915, ISSUED BY THE LEWIS RESEARCH CENTER OF YOUR ADMINISTRATION.

THE RECORD DISCLOSES THAT AFTER EVALUATION OF THE BIDS SUBMITTED, CONTRACT NO. NAS3-1762 WAS AWARDED TO THE SAID FIRM FOR ITEMS 2 (A), 2 (B) AND 2 (C), EQUAL TO A TOTAL QUOTATION OF $2,494, BEING THE LOWEST BID RECEIVED ON THOSE ITEMS. THEREAFTER, THE CONTRACTOR NOTIFIED THE PROCUREMENT AUTHORITIES THAT ITS QUOTATIONS WERE BASED ON ITS ESTIMATED LABOR COSTS ONLY, AND THAT IT HAD INADVERTENTLY OMITTED RAW MATERIAL COSTS AMOUNTING TO $2,091. BASED ON THE FOREGOING ITS INTENDED OFFER SHOULD HAVE BEEN $4,585.

LEWIS RESEARCH CENTER, UPON REVIEW OF THE FACTS AND CIRCUMSTANCES INVOLVED IN THIS TRANSACTION, CONCLUDED THAT IN VIEW OF THE MATERIAL DIFFERENCE BETWEEN THE LOW BID AND THE OTHER PROPOSALS SUBMITTED--- THE LOWEST CORRECT BID BEING $4,145--- AS WELL AS THE ESTIMATED COST OF $4,000 PREDETERMINED BY THE CENTER, THE CONTRACTING OFFICER SHOULD HAVE BEEN ON NOTICE OF THE PROBABILITY OF ERROR, AND SHOULD HAVE REQUESTED THE BIDDER TO CONFIRM SUCH OFFER. IT IS APPARENT FROM THE RECORD THAT FAILURE TO DETECT THE ERROR INDICATED BY THE DISPARITY IN THE PRICES WAS AN OVERSIGHT ON THE PART OF THE PROCUREMENT OFFICIALS. THE RELATED FACTS AND CIRCUMSTANCES SUPPORT THE CONCLUSION THAT A BONA FIDE ERROR WAS MADE AS ALLEGED AND, IN THAT SITUATION, OF COURSE VERIFICATION OF THE BID SHOULD HAVE BEEN REQUESTED BEFORE ACCEPTANCE.

IN VIEW THEREOF, CANCELLATION OF THE CONTRACT IS AUTHORIZED, AS YOU HAVE RECOMMENDED, AND AS REQUESTED BY YOU, ALL PAPERS ARE RETURNED HEREWITH.