B-146642, AUG. 24, 1961

B-146642: Aug 24, 1961

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DEPARTMENT OF THE INTERIOR: REFERENCE IS MADE TO YOUR LETTER OF AUGUST 10. FIVE BIDS WERE RECEIVED. THE ENGINEER'S ESTIMATE FOR SCHEDULE NO. 2 WAS $60. THE SECOND LOW BID WAS IN THE AMOUNT OF $70. THE LOW BIDDER WAS REQUESTED TO CHECK ITS PRICE COMPUTATIONS AND CONFIRM ITS PRICE AS ITS BID WAS SUBSTANTIALLY BELOW THE PRICE OF THE OTHER BIDDERS AND THE ENGINEER'S ESTIMATE. IT STATED THAT IT WAS PREPARED TO HONOR ITS BID BUT THAT IT WOULD NATURALLY WISH TO AVOID THE LOSS INVOLVED IN DOING SO. 162.50 WAS MADE IN PRICING THE SERIES TRANSFORMER WHICH FORMS A PART OF THE VOLTAGE REGULATOR. SINCE THE CONTRACTING OFFICER SUSPECTED AN ERROR IN THE BID OF THE LOW BIDDER AND SINCE THE EVIDENCE SUBMITTED SHOWS CLEARLY HOW THE MISTAKE WAS MADE AND THE AMOUNT OF THE INTENDED QUOTATION OF THE BIDDER'S ASSOCIATE.

B-146642, AUG. 24, 1961

TO ACTING ASSISTANT COMMISSIONER AND CHIEF ENGINEER, BUREAU OF RECLAMATION, U.S. DEPARTMENT OF THE INTERIOR:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 10, 1961, FILE D-150, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN WITH REGARD TO THE BID OF FERRANTI ELECTRIC, INC., SUBMITTED IN RESPONSE TO INVITATION FOR BIDS NO. DS-5599 ISSUED MAY 16, 1961.

THE INVITATION REQUESTED BIDS--- TO BE OPENED JUNE 22, 1961--- FOR FURNISHING A POWER TRANSFORMER AND VOLTAGE REGULATOR FOR A 69-KILOVOLT SWITCHYARD AT DAVIS DAM, PARKER-DAVIS PROJECT, ARIZONA. AS TO SCHEDULE NO. 2 WHICH CALLED FOR THE FURNISHING OF ONE 69-KV VOLTAGE REGULATOR, FIVE BIDS WERE RECEIVED. THE QUOTED F.O.B. DESTINATION PRICES RANGED FROM A LOW PRICE OF $33,525 QUOTED BY FERRANTI ELECTRIC, INC., TO A HIGH PRICE OF $74,830. THE ENGINEER'S ESTIMATE FOR SCHEDULE NO. 2 WAS $60,000. THE SECOND LOW BID WAS IN THE AMOUNT OF $70,584. BY LETTER OF JULY 11, 1961, THE LOW BIDDER WAS REQUESTED TO CHECK ITS PRICE COMPUTATIONS AND CONFIRM ITS PRICE AS ITS BID WAS SUBSTANTIALLY BELOW THE PRICE OF THE OTHER BIDDERS AND THE ENGINEER'S ESTIMATE. IN ITS REPLY OF JULY 14, 1961, FERRANTI STATED THAT IT MADE AN ERROR IN ITS COMPUTATIONS AND THAT ITS CORRECT PRICE WOULD STILL BE CONSIDERABLY LOWER THAN THE OTHER QUOTATIONS. ALSO, IT STATED THAT IT WAS PREPARED TO HONOR ITS BID BUT THAT IT WOULD NATURALLY WISH TO AVOID THE LOSS INVOLVED IN DOING SO. THEREAFTER, BY LETTER DATED AUGUST 4, 1961, FERRANTI SUBMITTED A NOTARIZED STATEMENT FROM THE VICE PRESIDENT AND GENERAL MANAGER OF ITS ASSOCIATE IN CANADA, FERRANTI-PACKARD ELECTRIC LIMITED, TOGETHER WITH COPIES OF THE ORIGINAL GRAPHS USED BY THAT COMPANY IN CALCULATING PRICES FOR VOLTAGE REGULATORS WHICH CLEARLY SHOW HOW A MISTAKE OF $4,162.50 WAS MADE IN PRICING THE SERIES TRANSFORMER WHICH FORMS A PART OF THE VOLTAGE REGULATOR.

SINCE THE CONTRACTING OFFICER SUSPECTED AN ERROR IN THE BID OF THE LOW BIDDER AND SINCE THE EVIDENCE SUBMITTED SHOWS CLEARLY HOW THE MISTAKE WAS MADE AND THE AMOUNT OF THE INTENDED QUOTATION OF THE BIDDER'S ASSOCIATE, THE BID MAY BE CORRECTED TO $37,687.50 AND CONSIDERED IN MAKING AWARD.