B-147512, DEC. 18, 1961

B-147512: Dec 18, 1961

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THE PROCUREMENT WAS INITIALLY ADVERTISED ON AUGUST 11. THE SPACE OFFERED WAS REQUIRED TO BE LOCATED WITHIN A DEFINED AREA OF MANHATTAN. FIVE BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. NONE OF WHICH WAS FROM YOUR FIRM. ALL WERE REJECTED EITHER BECAUSE THEY WERE NON- RESPONSIVE OR THE RENTALS WERE REGARDED AS EXCESSIVE. THE PROCUREMENT WAS READVERTISED UNDER INVITATION FOR BIDS NO. 2PRA 731. THE SPECIFICATIONS REMAINED THE SAME EXCEPT THAT THE FLOOR-CONTIGUITY REQUIREMENT WAS LESSENED. THE STORAGE AREA AND THE MINIMUM ACCEPTABLE AREA PER FLOOR REQUIREMENTS WERE RESPECTIVELY REDUCED TO APPROXIMATELY 7. THREE WERE REGARDED AS NON-RESPONSIVE AND THE OTHER WAS CONSIDERED TO DEMAND TOO HIGH A RENTAL.

B-147512, DEC. 18, 1961

TO HERMAN MILLER, ESQUIRE:

WE REFER AGAIN TO YOUR TELEGRAM OF OCTOBER 31, 1961, TO YOUR LETTER OF NOVEMBER 30, 1961, WITH ENCLOSURE, AND TO A LETTER OF DECEMBER 11, 1961, FROM MR. LOUIS DE SANTIS, ALL CONCERNING THE LEASING OF CERTAIN RENTAL SPACE IN MANHATTAN BY THE GENERAL SERVICES ADMINISTRATION.

THE PROCUREMENT WAS INITIALLY ADVERTISED ON AUGUST 11, 1961, UNDER INVITATION FOR BIDS NO. 2PRA-728, WHICH CALLED FOR APPROXIMATELY 115,000 SQUARE FEET OF NET USABLE AIR-CONDITIONED OFFICE SPACE AND AN ADDITIONAL 10,000 SQUARE FEET OF NET USABLE STORAGE SPACE. THE INVITATION ALSO PROVIDED FOR AN INITIAL LEASE TERM OF THREE YEARS WITH ANNUAL RENEWAL OPTIONS, AND SPECIFIED THAT THE SPACE BE ON CONTIGUOUS FLOORS WITH AT LEAST APPROXIMATELY 20,000 SQUARE FEET ON ALL BUT ONE FLOOR. FURTHER, THE SPACE OFFERED WAS REQUIRED TO BE LOCATED WITHIN A DEFINED AREA OF MANHATTAN. FIVE BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION, NONE OF WHICH WAS FROM YOUR FIRM. ALL WERE REJECTED EITHER BECAUSE THEY WERE NON- RESPONSIVE OR THE RENTALS WERE REGARDED AS EXCESSIVE.

THE PROCUREMENT WAS READVERTISED UNDER INVITATION FOR BIDS NO. 2PRA 731, DATED SEPTEMBER 18, 1961. THE SPECIFICATIONS REMAINED THE SAME EXCEPT THAT THE FLOOR-CONTIGUITY REQUIREMENT WAS LESSENED, AND THE STORAGE AREA AND THE MINIMUM ACCEPTABLE AREA PER FLOOR REQUIREMENTS WERE RESPECTIVELY REDUCED TO APPROXIMATELY 7,500 SQUARE FEET AND 19,000 SQUARE FEET EXCEPT FOR ONE OR TWO FLOORS AS NECESSARY TO MEET THE TOTAL SPACE REQUIREMENT. OF THE FOUR BIDS RECEIVED IN RESPONSE TO THE SECOND INVITATION, THREE WERE REGARDED AS NON-RESPONSIVE AND THE OTHER WAS CONSIDERED TO DEMAND TOO HIGH A RENTAL. ACCORDINGLY, ALL BIDS WERE REJECTED ON OCTOBER 13, 1961. YOUR LOW BID UNDER THIS INVITATION WAS REGARDED AS NON-RESPONSIVE FOR THE FOLLOWING REASONS:

1. THE BID OFFERED A TOTAL OF 119,000 SQUARE FEET OF FLOOR SPACE WHILE THE SPECIFICATIONS CALLED FOR A TOTAL OF 122,500 INCLUDING STORAGE SPACE.

2. THE SPACE OFFERED FELL AT LEAST 5,000 SQUARE FEET SHORT OF MEETING THE MINIMUM PER FLOOR AREA REQUIREMENT.

3. THE SPACE OFFERED HAD EXPOSED PIPES AND AIR CONDITIONING DUCTS IN AREAS WHERE THE SPECIFICATIONS REQUIRED THAT THEY BE COVERED.

4. THE BID DID NOT MEET THE SPECIFICATION REQUIREMENT FOR INDIVIDUAL THERMOSTATIC AIR CONDITIONING CONTROLS IN CERTAIN AREAS.

AFTER TWO UNSUCCESSFUL ATTEMPTS TO OBTAIN THE NEEDED SPACE BY FORMAL ADVERTISING, IT WAS DETERMINED BY THE GENERAL SERVICES ADMINISTRATION REGIONAL OFFICE TO NEGOTIATE THE PROCUREMENT PURSUANT TO SECTION 302 (C) (14) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, AS AMENDED, 41 U.S.C. 252 (C) (14), WHICH AUTHORIZES NEGOTIATION WHEN IT IS DETERMINED THAT NO REASONABLE PRICE HAS BEEN RECEIVED PURSUANT TO FORMAL ADVERTISING. AFTER NEGOTIATIONS, THE REGIONAL COMMISSIONER, NEW YORK, HAS RECOMMENDED THAT THE REQUIREMENT BE MET BY LEASING SPACE AT 30 CHURCH STREET. HOWEVER, FINAL ACTION HAS BEEN WITHHELD PENDING OUR DECISION.

YOU CONCEDE THAT THE SPACE OFFERED BY YOU DOES NOT MEET THE STATED SPECIFICATION REQUIREMENTS; YOU CONTEND, HOWEVER, THAT IT FULLY MEETS THE AGENCY'S ACTUAL NEEDS. FURTHER, YOU POINT OUT THAT AN AWARD TO YOU WILL RESULT IN A SAVING TO THE GOVERNMENT OF APPROXIMATELY $225,000 OVER THE FIRST THREE YEARS.

IT IS THE POSITION OF THE PROCURING AGENCY THAT THE SPECIFICATIONS DID NOT OVERSTATE THE GOVERNMENT'S ACTUAL NEEDS. IN SUBSTANTIATION OF THAT POSITION, THE ADMINISTRATIVE REPORT CONTAINS THE FOLLOWING STATEMENT:

"9. THE REQUIREMENTS FOR THE RELOCATION OF THIS OFFICE WERE NOT ARBITRARILY OR CAPRICIOUSLY DETERMINED. A THOROUGH DETAILED UTILIZATION STUDY OF EACH COMPONENT UNIT OF THE REGIONAL OFFICE WAS UNDERTAKEN WITH FULL CONSIDERATION GIVEN TO EXISTING FUNCTIONS, WORK FLOW, CIRCULATION AREAS AND INTERDEPENDENCY OF SERVICES, DIVISIONS, BRANCHES, AND OTHER COMPONENT UNITS. THE REGIONAL OFFICE IS COMPOSED OF SIX INTERDEPENDENT SERVICES, WITH INTEGRATED FUNCTIONS AND OPERATIONS. BASED ON OUR CAREFUL STUDY, IT WAS DETERMINED THAT THE MINIMUM SQUARE FEET PER FLOOR, GIVING PROPER UTILIZATION, EFFICIENCY AND ECONOMY OF OPERATION, WOULD BE 19,000 SQUARE FEET. THIS MINIMUM REQUIREMENT PERMITS THE HOUSING OF THE TWO LARGER SERVICES ON ONE FLOOR EACH AND THE SMALL SERVICES AND ADMINISTRATIVE UNITS COMBINED TO UTILIZED FULL FLOOR AREAS OF 19,000 SQUARE FEET OR MORE ON A FUNCTIONALLY INTEGRATED BASIS. IT IS TO BE NOTED THAT OUR SPECIFICATION FOR 19,000 SQUARE FEET PER FLOOR WAS OUR MINIMUM REQUIREMENT, AND THAT THERE WAS NO PROHIBITION AGAINST OFFERING OF LARGER FLOOR AREAS; IN FACT WE HAVE RECOMMENDED THE ACCEPTANCE OF THE OFFER FOR SPACE AT 30 CHURCH STREET WHICH WILL PROVIDE FLOOR AREAS UP TO 25,000 SQUARE FEET. IN THIS CONNECTION AN OPTIMUM SPECIFICATION WOULD BE MUCH LARGER SINGLE FLOOR AREAS, AS IT IS RECOGNIZED IN THE SPACE PLANNING FIELD THAT SPACE REQUIREMENTS WILL INCREASE AS THE TOTAL NUMBER OF FLOORS INCREASE BECAUSE OF THE NEED TO DUPLICATE ON EACH FLOOR FACILITIES SUCH AS RECEPTION AREAS, CONFERENCE ROOMS, AS WELL AS AN INCREASE IN AMOUNT OF CORRIDORS, ETC.'

IN THE LETTER OF DECEMBER 11, 1961, IT IS CONTENDED THAT IF A MODULE OR FORMULA WAS USED BY GENERAL SERVICES ADMINISTRATION TO ARRIVE AT THE MINIMUM FLOOR AREA REQUIREMENT OF 19,000 SQUARE FEET, THE SPACE AVAILABLE AT 30 CHURCH STREET WOULD REQUIRE DIVISION OF ORGANIZATIONAL SEGMENTS OTHER THAN CONTEMPLATED BY THE STATED REQUIREMENT BECAUSE THOSE PREMISES CANNOT BE ARRANGED IN FLOOR MULTIPLES OF 19,000 SQUARE FEET. IF SUCH REARRANGEMENT IS PROPER,YOU CONTEND IT IS EQUALLY APPROPRIATE TO MAKE REARRANGEMENTS TO UTILIZE THE SPACE AT 143 LIBERTY STREET. THE 30 CHURCH STREET BID OFFERED SPACE ON FLOORS 14, 15, 17, 18, 19 AND 20 WITH STORAGE ONLY ON THE 14TH FLOOR. SPACE OFFERED ON THE OTHER FLOORS IS AS FOLLOWS:

TABLE

FLOOR SQUARE FEET USABLE FLOOR SPACE

20 26,334

19 20,107

18 26,334

17 25,369

15 16,886

115,030

WHILE WE HAVE NO INFORMATION AS TO THE ARRANGEMENTS WHICH WOULD BE NECESSARY TO ACCOMMODATE THE PROPOSED UTILIZATION TO THE AVAILABLE SPACE, THE SPACE OFFERED AS SHOWN ABOVE DOES NOT APPEAR SO FAR REMOVED FROM THE STATED MINIMUMS AND OPTIMUMS AS TO WARRANT A CONCLUSION THAT SPACE ARRANGED 14,000 SQUARE FEET TO THE FLOOR WOULD SERVE AS WELL.

THE DRAFTING OF PROPER SPECIFICATIONS WHICH REFLECT THE NEEDS OF THE GOVERNMENT AND THE DETERMINATION FACTUALLY WHETHER THE OFFERS MADE BY THE BIDDERS MEET THOSE SPECIFICATIONS ARE PRIMARILY THE RESPONSIBILITY OF THE CONTRACTING AGENCY. 17 COMP. GEN. 554. WHILE IT IS OUR DUTY TO DETERMINE WHETHER SPECIFICATIONS AS WRITTEN ARE UNDULY RESTRICTIVE OF COMPETITION, THE MERE FACT THAT A PARTICULAR BIDDER MAY BE UNABLE OR UNWILLING TO MEET THE STATED REQUIREMENTS IS NOT SUFFICIENT TO SUPPORT A CONCLUSION THAT THE SPECIFICATIONS ARE UNDULY RESTRICTIVE. 33 COMP. GEN. 586. THERE IS NO REQUIREMENT THAT THE GOVERNMENT LEASE SPACE MERELY BECAUSE IT IS OFFERED AT A LOWER PRICE WITHOUT INTELLIGENT REFERENCE TO THE PARTICULAR NEEDS TO BE SERVED; NOR CAN WE REGARD IT AS PROPER TO ALLOW BIDDERS TO DICTATE SPECIFICATIONS WHICH WILL PERMIT AWARD OF A CONTRACT WHICH IN THE CONSIDERED JUDGMENT OF THE CONTRACTING AGENCY--- WHICH IN THIS INSTANCE WILL ALSO BE THE USING AGENCY--- DOES NOT MEET THE AGENCY'S NEEDS. COMP. GEN. 251, 252.

APPLYING THE FOREGOING PRINCIPLES, WE CANNOT FIND THAT THERE HAS BEEN PRESENTED AN ADEQUATE BASIS TO JUSTIFY A DETERMINATION THAT THE SPECIFICATIONS EMPLOYED BY THE PROCURING AGENCY DO NOT IN FACT REPRESENT THE GOVERNMENT'S ACTUAL NEEDS. THEREFORE, SINCE THE NEGOTIATION AUTHORITY WAS PROPERLY INVOKED AND THE NEGOTIATIONS APPEAR TO HAVE BEEN CARRIED ON IN THE GOVERNMENT'S BEST INTERESTS, WE FIND NO BASIS FOR OBJECTING TO THE PROPOSED AWARD. SEE B-139160, JUNE 10, 1959; B 118994. SEPTEMBER 22, 1954.