B-147586, DECEMBER 20, 1961, 41 COMP. GEN. 412

B-147586, DECEMBER 20, 1961, 41 COMP. GEN. 412

BIDS - QUALIFIED - OMISSION OF ITEMS - OFFER TO FURNISH AT NO EXTRA COST A BIDDER WHO FAILS TO QUOTE A PRICE ON ENGINEERING DATA ITEMS AND ON SEVERAL ITEMS OF EQUIPMENT ADDED BY AN AMENDMENT TO AN INVITATION WHICH SPECIFICALLY REQUIRED BIDDERS WHO HAD NOT FURNISHED THE DATA TO SUBMIT A BID ON ORIGINAL DATA HAS SUBMITTED A BID WHICH DOES NOT CONFORM TO THE INVITATION AND WHICH DOES NOT INDICATE THE INTENTION OF THE BIDDER, AND TO PERMIT THE BIDDER TO CLARIFY HIS INTENTION THAT THE ITEMS WERE TO BE FURNISHED WITHOUT ADDITIONAL CHARGE WOULD BE PREJUDICIAL TO OTHER BIDDERS; THEREFORE, THE REJECTION OF THE BID AS NONRESPONSIVE WAS PROPER.

TO THE DECITRON ELECTRONICS CORPORATION, DECEMBER 20, 1961:

WE REFER TO YOUR LETTERS OF NOVEMBER 21 AND 28, 1961, CONCERNING YOUR PROTEST AGAINST REJECTION OF YOUR BID UNDER IFB 33-657-62-7, ISSUED ON JULY 28, 1961, BY THE AERONAUTICAL SYSTEMS DIVISION, AIR FORCE SYSTEMS COMMAND, WRIGHT-PATTERSON AIR FORCE BASE, OHIO.

THE INVITATION SOLICITED BIDS FROM SMALL BUSINESS CONCERNS ONLY FOR SEVERAL ITEMS OF ANTENNA SELECTORS, RADIO FREQUENCY TRANSMISSION LINE, SWITCHES AND ANTENNA SWITCHING UNITS. AMENDMENT NO. 1, DATED AUGUST 23, 1961, CHANGED CERTAIN SPECIFICATIONS SLIGHTLY AND AMENDMENT NO. 2, DATED AUGUST 31, 1961, ADDED ITEMS TOTALING 10 UNITS IN EACH OF THE THREE CATEGORIES.

DECITRON WAS LOW BIDDER ON THE ANTENNA SELECTORS DESCRIBED IN ITEMS 1.1 THROUGH 1.9. YOUR COMPANY DID NOT SUBMIT A BID ON ITEM 1.11A, ENGINEERING DATA ( ORIGINALS) FOR ITEMS 1.1 THROUGH 1.9, NOR DID YOU SUBMIT A BID ON ITEM 1.11B, ENGINEERING DATA ( REVISIONS) FOR THE ABOVE ITEMS, ALTHOUGH YOUR COMPANY'S BID CONTAINED AN "X" IN THE BLOCK INDICATING " REVISIONS TO THE ABOVE ENGINEERING DATA ARE PRESENTLY REQUIRED TO BE FURNISHED HEREUNDER.' AMENDMENTS NO. 1 AND 2 WERE PROPERLY SIGNED AND RETURNED WITH YOUR BID, BUT YOU SUBMITTED NO BID FOR ITEMS 1.13 AND 1.14 WHICH WERE ADDED BY AMENDMENT NO. 2.

ELECTRONIC SPECIALTY COMPANY, LOS ANGELES, CALIFORNIA, WAS LOW BIDDER ON ITEMS 2.1 THROUGH 2.8, 2.11 AND 2.13. ITS BID WAS DECLARED NONRESPONSIVE UPON DETERMINATION THAT THE COMPANY WAS NOT A SMALL BUSINESS CONCERN. TRANSCO PRODUCTS, INC., LOS ANGELES, CALIFORNIA, WAS SECOND LOW BIDDER ON ITEMS 2.1 THROUGH 2.8, 2.11 AND 2.13, AND A CONTRACT IN THE AMOUNT OF $62,895 WAS AWARDED TO TRANSCO ON NOVEMBER 17, 1961. DECITRON WAS THIRD LOW BIDDER FOR THESE ITEMS BUT FAILED TO SUBMIT A BID ON THE APPLICABLE ENGINEERING DATA ITEM.

DECITRON WAS LOW BIDDER FOR ITEMS 3.1 THROUGH 3.10 BUT DID NOT SUBMIT A BID ON ITEMS 3.13 AND 3.14, ADDED BY AMENDMENT NO. 2, AND AGAIN FAILED TO SUBMIT A BID ON THE APPLICABLE ITEM FOR ORIGINAL ENGINEERING DATA. ALTHOUGH YOUR COMPANY HAD NOT PREVIOUSLY FURNISHED ORIGINAL ENGINEERING DATA FOR THESE ITEMS, YOUR BID CONTAINED AN "X" UNDER 3.11B, ENGINEERING DATA ( REVISIONS), INDICATING " REVISIONS TO THE ABOVE ENGINEERING DATA ARE PRESENTLY REQUIRED TO BE FURNISHED HEREUNDER," AND DID NOT CONTAIN ANY ENTRY IN THE PRICE COLUMN FOLLOWING ITEM 3.11B.

ON PAGE 5 OF THE INVITATION, THE FOLLOWING PROVISIONS ARE SET FORTH: ORIGINAL AND REVISION DATA APPLICABILITY:

BIDDERS WHO HAVE NOT PREVIOUSLY FURNISHED TO THE GOVERNMENT DATA COVERING THE MATERIAL LISTED UNDER ITEMS 1.1 THRU 1.9 HEREOF, SHALL SUBMIT A BID ON THE ORIGINAL DATA CALLED FOR HEREIN.

BIDDERS WHO HAVE PREVIOUSLY FURNISHED TO THE GOVERNMENT DATA COVERING THE MATERIAL LISTED UNDER ITEMS 1.1 THRU 1.9 HEREOF, SHALL SUBMIT A BID ON THE REVISION DATA CALLED FOR HEREIN.

BIDS SUBMITTED ON ORIGINAL ENGINEERING DATA OR REVISION ENGINEERING DATA ARE EQUALLY ACCEPTABLE TO THE GOVERNMENT, AS APPLICABLE, AND AWARD WILL BE MADE THEREON WITH THE BEST INTEREST OF THE GOVERNMENT CONSIDERED.

SIMILAR PROVISIONS REGARDING GROUPS 2 AND 3 APPEAR ON PAGES 8 AND 10, RESPECTIVELY. ON PAGE 12, THE FOLLOWING CLAUSE APPEARS:

DATA PRICING: ( MAR. 1961)

BIDDERS ARE REQUIRED TO INSERT OPPOSITE THE DATA ITEMS THE PRICE OF SUCH DATA.

(1) BIDDERS SHALL NOT SUBMIT BIDS ON DATA ITEMS WITH THE WORDS " NO. CHARGE FOR DATA" OR " DATA PRICE INCLUDED IN COSTS OF END ITEMS.'

IN A REPORT DATED DECEMBER 5, 1961, THE DEPARTMENT OF THE AIR FORCE ADVISES THAT THE CONTRACTING OFFICE FOUND YOUR BID TO BE NONRESPONSIVE FOR FAILING TO QUOTE A PRICE FOR ENGINEERING DATA AND NO BASIS WAS FOUND FOR CONCLUDING THAT THE PRICE OF THE DATA WAS INCLUDED IN THE PRICE OF THE EQUIPMENT. SINCE YOUR COMPANY HAD NEVER FURNISHED THE ITEMS OF EQUIPMENT TO THE AIR FORCE PREVIOUSLY, THE CONTRACTING OFFICE INTERPRETED THE DATA APPLICABILITY CLAUSES QUOTED ABOVE AS MAKING THE SUBMISSION OF A BID ON THE ORIGINAL DATA MANDATORY IN YOUR CASE, AND THE DEPARTMENT CONCURS IN THIS INTERPRETATION. YOUR FAILURE TO SUBMIT A SPECIFIC RESPONSE ON THE ORIGINAL ENGINEERING DATA ITEMS, THEREFORE, WAS NOT CONSIDERED AS AN INFORMALITY OR MINOR IRREGULARITY SINCE IT AFFECTS THE PRICE OF AN ITEM THAT MUST BE CONSIDERED IN AN EVALUATION OF THE BID.

YOUR LETTER OF NOVEMBER 21, 1961, PROTESTING THE REJECTION OF YOUR BID AS NONRESPONSIVE, STATES THAT IT WAS YOUR INTENTION TO FURNISH THE ENGINEERING DATA TO THE GOVERNMENT AT NO COAST AND THAT YOU INTENDED YOUR OMISSION TO INDICATE THAT NO COST WAS INVOLVED. YOU CONTEND THAT YOU ARE MERELY SEEKING TO COMPLETE OR CLARIFY YOUR BID TO CARRY OUR YOUR ORIGINAL INTENT, A ZERO DOLLAR CHARGE FOR ITEMS 1.11A, 2.10A AND 3.11A. IN SUPPORT OF YOUR CONTENTION YOU SUBMIT WORKSHEETS FOR EACH OF THE THREE GROUPS OF ITEMS BEARING THE NOTATION " ENGINEERING DATA, NO BID, NO CHARGE ( NEGOTIATE REVISION).' YOU STATE THAT YOU REGARD ENGINEERING DATA AS AN INTEGRAL PART OF YOUR END PRODUCT AND YOU DO NOT MAINTAIN COST RECORDS WHICH WOULD ENABLE YOU TO BREAK DOWN THE COST OF ENGINEERING DATA. FURTHER SUPPORT OF YOUR CONTENTION THAT YOU INTENDED YOUR OMISSION TO BE A BID OF NO CHARGE FOR ENGINEERING DATA, YOU POINT OUT THAT YOU DID QUOTE PRICES ON ITEMS 1.12A AND 3.12A (TECHNICAL DATA) WHICH REFLECT ONLY A MINIMUM MARKUP OVER THE ACTUAL COST FOR OUT-OF-HOUSE PURCHASE OF THESE ITEMS, AND YOU SUGGEST THAT IT CAN BE DEDUCED THEREFROM THAT YOU INTENDED NO CHARGE FOR IN-HOUSE ENGINEERING DATA. YOU ALSO CONTEND THAT THE QUESTION OF NONRESPONSIVENESS SHOULD NOT ARISE IN CONNECTION WITH YOUR BID SINCE PARAGRAPH 8 (C) OF THE INVITATION PROVIDES THAT THE GOVERNMENT MAY ACCEPT ANY ITEM OR GROUP OF ITEMS UNLESS THE BIDDER QUALIFIES HIS BID BY SPECIFIC LIMITATION AND YOU DID NOT QUALIFY YOUR BID. IN CONNECTION WITH THIS CLAUSE, YOU REFER TO OUR DECISION B-123562 AS STATING THE RULE THAT THE PRESENCE OF A CLAUSE SUCH AS 8 (C) MAKES IT POSSIBLE FOR THE GOVERNMENT TO ACCEPT THE LOW AGGREGATE BID ON ALL ITEMS EXCEPT THE ITEM WHICH HAD NOT BEEN BID AND TO CANCEL THAT ITEM.

OUR DECISION IN B-123562, DATED APRIL 21, 1955, AND OUR RECONSIDERATION OF THE MATTER ON MAY 10, 1955, DEALT WITH A SITUATION INVOLVING TWO CLOSELY RELATED DATA ITEMS IN WHICH EVIDENCE ADMITTED TO PROVE THAT A BID ON ONE OF THE DATA ITEMS INCLUDED COSTS FOR BOTH DATA ITEMS. A MORE SIGNIFICANT DIFFERENCE BETWEEN THAT CASE AND THE PRESENT ONE ARISES FROM THE FACT THAT IN THE EARLIER CASE THERE WAS NO REQUIREMENT THAT A BIDDER MUST QUOTE A PRICE ON EVERY ITEM WHILE IN THE PRESENT CASE THERE IS A REQUIREMENT STATED IN UNMISTAKABLE TERMS THAT A BIDDER WHO HAS NOT PREVIOUSLY FURNISHED THIS EQUIPMENT TO THE GOVERNMENT "SHALL SUBMIT A BID ON THE ORIGINAL DATA CALLED FOR HEREIN.' THEREFORE, WE DO NOT REGARD THE CONCLUSIONS REACHED IN B 123562 AS BEING RELEVANT TO THE SITUATION WE ARE CONSIDERING HERE. NOR DO WE CONSIDER THE FACTS IN THIS CASE ANALOGOUS TO THE FACTS IN 40 COMP. GEN. 321 WHEREIN WE HELD THAT A BID WAS NOT RENDERED NONRESPONSIVE BY USE OF THE SYMBOL "O" INSTEAD OF THE PRESCRIBED SYMBOL "N/C" TO INDICATE " NO CHARGE" FOR AN ITEM OF SERVICE WHICH WAS NOT CONSIDERED IN EVALUATING THE BIDS. IN THE PRESENT CASE, NOT ONLY DID YOU FAIL TO COMPLY WITH THE INSTRUCTIONS IN THE INVITATION REGARDING BIDDING ON THE ITEMS OF ENGINEERING DATA, BUT YOU MADE NO QUOTATION WHATEVER REGARDING THE PRICE OF THOSE ITEMS, NOT EVEN A SYMBOL AS "O.' MOREOVER, THE PRICES OF THOSE ITEMS WERE REGARDED BY THE ADMINISTRATIVE OFFICE AS MATERIAL AND WERE USED IN EVALUATING THE BIDS.

IN OUR OPINION, THE PROPER RULE TO BE APPLIED IS DISCUSSED IN 38 COMP. GEN. 372, 376, WHEREIN WE STATED," WHERE THE ERROR IS ONE OF FAILURE TO QUOTE A PRICE, SUCH AS MAY BE CONSIDERED TO BE INVOLVED IN THE INSTANT CASE, THE BID NORMALLY WOULD BE FOR REJECTION AS NOT BEING RESPONSIVE TO THE INVITATION.' IN THIS REGARD, WE MUST CONSIDER THE EFFECT, NOT ONLY OF YOUR FAILURE TO QUOTE A PRICE FOR THE ITEMS INVOLVING ENGINEERING DATA, BUT ALSO THE EFFECT OF YOUR FAILURE TO QUOTE A PRICE ON THE ITEMS OF EQUIPMENT ADDED BY AMENDMENT NO. 2. THIS AMENDMENT ADDED A TOTAL OF 10 ITEMS OF EQUIPMENT TO EACH OF THE THREE GROUPS AND, IN ADDITION, PROVIDED THAT DELIVERY OF THE ADDED ITEMS MUST BE ACCOMPLISHED "WITHIN 90 DAYS AFTER RECEIPT OF WRITTEN GOVERNMENT APPROVAL OF TEST DATA.' THE ORIGINAL DELIVERY SCHEDULE REQUIRED DELIVERY OF 60 UNITS WITHIN 90 DAYS AFTER RECEIPT OF WRITTEN GOVERNMENT APPROVAL OF TEST DATA.' THE ORIGINAL DELIVERY SCHEDULE REQUIRED DELIVERY OF 60 UNITS WITHIN 90 DAYS AFTER RECEIPT OF WRITTEN APPROVAL FOR GROUPS 1 AND 2, AND 35 UNITS WITHIN 90 DAYS FOR GROUP 3. THE ADDITION OF 10 UNITS TO EACH GROUP IN THE INITIAL DELIVERY PERIOD REPRESENTS A SUBSTANTIAL PERCENTAGE OF INCREASED PRODUCTION AT A TIME WHEN THE GREATEST DIFFICULTIES WOULD NORMALLY BE EXPECTED IN SETTING UP A PRODUCTION RUN AND, THEREFORE, MUST BE CONSIDERED A MATERIAL FACTOR IN EVALUATING THE BIDS. YOUR FAILURE TO QUOTE A PRICE ON THE ITEMS ADDED BY AMENDMENT NO. 2 RENDERS YOUR BID NONRESPONSIVE IN THIS RESPECT, IF, AS IS THE CASE, THE GOVERNMENT WISHES TO MAKE AN AWARD INCLUDING THE ITEMS ADDED BY AMENDMENT NO. 2.

A FURTHER SERIOUS QUESTION REGARDING THE RESPONSIVENESS OF YOUR BID ARISES FROM YOUR FAILURE TO QUOTE PRICES ON THE ENGINEERING DATA ITEMS, WHEN THE BID DOCUMENT IS CONSIDERED IN ITS ENTIRETY. THE FOLLOWING PROVISION APPEARS ON THE COVER PAGE:

IN COMPLIANCE WITH THE ABOVE, THE UNDERSIGNED OFFERS AND AGREES, IF THIS BID BE ACCEPTED WITHIN ---------- CALENDAR DAYS (60 CALENDAR DAYS UNLESS A DIFFERENT PERIOD BE INSERTED BY THE BIDDER) FROM THE DATE OF THE OPENING, TO FURNISH ANY OR ALL OF THE ITEMS UPON WHICH PRICES ARE QUOTED, AT THE PRICE SET OPPOSITE EACH ITEM, DELIVERED AT THE DESIGNATED POINT/S) WITHIN THE TIME SPECIFIED IN THE ATTACHED SCHEDULE.

ON PAGE 11, THERE IS AN ENTRY AS FOLLOWS:

TOTAL OF ALL ITEMS BID ON $264,820 DOLLARS

---------------- CENTS. ($264,820)

UNDER THESE PROVISIONS, WE FEEL THAT ACCEPTANCE OF YOUR BID WOULD NOT RESULT IN A CONTRACT WHICH WOULD OBLIGATE YOU TO FURNISH THE DATA ITEMS UPON WHICH NO PRICE WAS QUOTED. YOUR REQUEST THAT YOU BE ALLOWED TO COMPLETE OR CLARIFY YOUR BID IS AN INDICATION THAT YOU CONSIDER YOUR BID TO BE INCOMPLETE OR UNCLEAR TO THE EXTENT THAT IT DOES NOT STATE YOUR INTENTION WITHOUT MODIFICATION. A COMPLETION OR CLARIFICATION OF THIS MAGNITUDE MUST BE REGARDED AS A CHANGE DESPITE YOUR ASSERTION THAT IT IS NOT, AND TO PERMIT CORRECTION OF YOUR BID SO THAT IT CONFORMS TO THE INVITATION WOULD VIOLATE THE ESTABLISHED RULE, FOLLOWED BY THE COURTS AND BY THIS OFFICE, THAT A BID MAY NOT BE ALTERED AFTER OPENING.

SECTION 2305 (C) OF TITLE 10, U.S. CODE, REQUIRES THAT A BID MUST CONFORM TO THE INVITATION TO BE ACCEPTABLE. IN VIEW OF THE SPECIFIC INSTRUCTIONS REQUIRING A BID ON ORIGINAL ENGINEERING DATA FROM THOS BIDDERS WHO HAD NOT PREVIOUSLY FURNISHED THIS EQUIPMENT, WE FIND NOTHING ON THE FACE OF YOUR BID TO INDICATE THAT YOUR BID CONFORMS TO THE INVITATION AS REQUIRED BY THE STATUTE.

WE ARE UNABLE TO AGREE WITH YOUR SUGGESTION THAT IT IS REASONABLE TO DEDUCE FROM THE FACT THAT YOU QUOTED A PRICE ON 2 ITEMS OF TECHNICAL DATA THAT THEREFORE YOU INTENDED TO FURNISH 3 ITEMS OF ENGINEERING DATA AT ZERO DOLLAR CHARGE. SINCE YOUR TOTAL PRICE WAS QUOTED ON ALL ITEMS BID ON, IT SEEMS MORE REASONABLE TO DEDUCE THAT YOU BID ON ONLY THOSE ITEMS WHICH YOU INTENDED TO FURNISH AND YOU THEREFORE WOULD NOT BE OBLIGATED TO FURNISH ANY ITEMS UPON WHICH YOU DID NOT BID.

A FURTHER ELEMENT OF AMBIGUITY REGARDING YOUR INTENTIONS IS INTRODUCED BY THE FACT THAT YOU PLACED AN "X" IN THE BLANKS IN THE REVISION DATA ITEMS INDICATING " REVISIONS TO THE ABOVE ENGINEERING DATA ARE PRESENTLY REQUIRED TO BE FURNISHED HEREUNDER.' SINCE IT IS PATENTLY IMPOSSIBLE TO FURNISH REVISIONS TO ORIGINAL DATA WHICH YOU HAVE NOT PREVIOUSLY FURNISHED, YOUR INTENTIONS REGARDING THE DATA CANNOT BE DETERMINED WITHOUT GOING OUTSIDE THE BID ITSELF.

WE AGREE WITH YOUR OPINION THAT COMPLETION OR CLARIFICATION OF YOUR BID IS NECESSARY TO SPELL OUT YOUR INTENTIONS. HOWEVER, PERMITTING BIDDERS TO ALTER THEIR PROPOSALS AFTER BIDS HAVE BEEN OPENED AND THE PRICES OF ALL BIDDERS ARE EXPOSED WOULD BE IN DISREGARD OF ESTABLISHED PROCEDURES FOR PROTECTING AND PRESERVING THE COMPETITIVE BIDDING SYSTEM. YOU CONTEND A DOMINANT FACT IS THAT A SAVING TO THE GOVERNMENT COULD BE EFFECTED BY ACCEPTING YOUR BID, BUT WE HAVE CONSISTENTLY HELD THAT IT IS MORE IN THE PUBLIC INTEREST TO COMPLY WITH ESTABLISHED PROCEDURES THAN TO OBTAIN A PECUNIARY ADVANTAGE IN A PARTICULAR CASE.

WE MUST REJECT THE SUGGESTION IN YOUR LETTER OF NOVEMBER 28, 1961, THAT A RECENT CHANGE IN THE DATA PRICING CLAUSE IN ANOTHER PROCUREMENT SUPPORTS YOUR POSITION IN THIS MATTER. YOUR BID WAS RESPONSIVE OR NONRESPONSIVE IN TERMS OF THE INVITATION UPON WHICH YOU SUBMITTED YOUR BID AND WHETHER SUBSEQUENT INVITATIONS CONTAIN THE SAME TERMS OR DIFFERENT ONES HAS NO EFFECT ON THE RESPONSIVENESS OF YOUR BID IN THIS INSTANCE. FOR THE REASONS STATED, IT IS OUR OPINION THAT YOUR FAILURE TO BID ON THE EQUIPMENT ITEMS ADDED AND DELIVERY CHANGES MADE BY AMENDMENT NO. 2, AND YOUR FURTHER FAILURE TO BID ON THE REQUIRED DATA ITEMS RENDERED YOUR BID NONRESPONSIVE. ACCORDINGLY, WE FIND NO LEGAL BASIS FOR OBJECTION TO THE ACTION OF THE DEPARTMENT OF THE AIR FORCE IN REJECTING YOUR BID AS BEING NONRESPONSIVE.