B-147601, NOV. 29, 1961

B-147601: Nov 29, 1961

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DEPARTMENT OF COMMERCE: REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 13. IN VIEW OF ERRORS ALLEGED BY THE COMPANY TO HAVE BEEN MADE IN ITS BID. WHICH WAS ISSUED ON OCTOBER 9. SIX OTHER BIDS WERE RECEIVED FOR THE PROJECT RANGING FROM $777. THE GOVERNMENT ENGINEER'S ESTIMATE WAS $941.740. THE KNISELY-MOORE COMPANY REQUESTED YOUR PERMISSION TO WITHDRAW ITS BID ON THIS PROJECT IN VIEW OF CERTAIN ERRORS ALLEGED TO HAVE BEEN MADE THEREIN. THERE FOLLOWED A GENERAL ANALYSIS TO ASCERTAIN HOW THE TOTAL BID OF THE COMPANY WOULD HAVE BEEN SUBMITTED HAD NO ERRORS BEEN MADE. THE SPECIFIC ERRORS ALLEGED BY KNISELY-MOORE WERE THAT THE COMPANY FAILED TO INCLUDE THE COSTS FOR HAULING THE MATERIAL INVOLVED UNDER ITEMS NO. 104 (2).

B-147601, NOV. 29, 1961

TO MR. K. S. CHAMBERLAIN, REGIONAL ENGINEER, BUREAU OF PUBLIC ROADS, REGION NINE, DEPARTMENT OF COMMERCE:

REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 13, 1961, WITH ENCLOSURES, FILE 09-71, REQUESTING OUR DECISION AS TO WHETHER THERE PROPERLY MAY BE DISREGARDED THE LOW BID OF THE KNISELY-MOORE COMPANY, DOUGLAS, WYOMING, UNDER AN INVITATION FOR CERTAIN CONSTRUCTION WORK IN CONNECTION WITH WYOMING FOREST HIGHWAY PROJECT 3-3 (1), IN VIEW OF ERRORS ALLEGED BY THE COMPANY TO HAVE BEEN MADE IN ITS BID.

IN RESPONSE TO THE INVITATION, WHICH WAS ISSUED ON OCTOBER 9, 1961, BY THE BUREAU OF PUBLIC ROADS, DENVER, COLORADO, THE KNISELY-MOORE COMPANY SUBMITTED A BID OFFERING TO PERFORM, IN STRICT ACCORDANCE WITH APPLICABLE PROVISIONS, SPECIFICATIONS, SCHEDULES, DRAWINGS, ETC., ALL WORK FOR THE CONSTRUCTION OF WYOMING FOREST HIGHWAY PROJECT 3-3 (1). HOBACK CANYON, SUBLETTE COUNTY, WYOMING, FOR A TOTAL PRICE OF $674,560. SIX OTHER BIDS WERE RECEIVED FOR THE PROJECT RANGING FROM $777,230 TO $960,330, AND THE GOVERNMENT ENGINEER'S ESTIMATE WAS $941.740. BY LETTER DATED NOVEMBER 7, 1961, THE KNISELY-MOORE COMPANY REQUESTED YOUR PERMISSION TO WITHDRAW ITS BID ON THIS PROJECT IN VIEW OF CERTAIN ERRORS ALLEGED TO HAVE BEEN MADE THEREIN. THE COMPANY SHOWS A TOTAL COST INCREASE OF $96,566.05 IN EXCESS OF THE BID COSTS USED IN COMPUTING THE BID. AT A CONFERENCE MR. V. H. KNISELY OF THE COMPANY EXPLAINED TO BUREAU OF PUBLIC ROADS REPRESENTATIVES THE METHOD USED IN FIGURING THE BID, AS REFLECTED BY THE ORIGINAL WORK SHEETS. THERE FOLLOWED A GENERAL ANALYSIS TO ASCERTAIN HOW THE TOTAL BID OF THE COMPANY WOULD HAVE BEEN SUBMITTED HAD NO ERRORS BEEN MADE.

THE SPECIFIC ERRORS ALLEGED BY KNISELY-MOORE WERE THAT THE COMPANY FAILED TO INCLUDE THE COSTS FOR HAULING THE MATERIAL INVOLVED UNDER ITEMS NO. 104 (2), SPECIAL SUB-BASE, GRADING B-1, NO. 200 (4), CRUSHED AGGREGATE BASE, GRADING E; AND NO. 217 (1), PLANT-MIXED BASE. THESE ITEMS COVERED A TOTAL OF 107,500 TONS OF SURFACING MATERIALS AND, AS STATED BY YOU, NEITHER SECTION C NOR E OF THE COMPANY'S WORK SHEETS, WHICH SET FORTH A DETAILED ANALYSIS OF THE COMPANY'S UNIT COSTS FOR VARIOUS ITEMS AND WHICH INCLUDE THE ANALYSIS OF THE SURFACING COSTS HERE CONSIDERED, APPEARS TO SHOW ANY AMOUNT AS HAVING BEEN INCLUDED AS COSTS FOR HAULING NOTWITHSTANDING THAT THE SPECIFICATIONS PROVIDE FOR INCLUDING SUCH COSTS IN THE UNIT PRICE BID. IN ITS LETTER OF OF NOVEMBER 7, 1961, THE COMPANY SHOWS A TOTAL COST INCREASE FOR THIS ITEM OF $41,925.

THE COMPANY ALSO STATES THAT IT FAILED TO INCLUDE THE COST OF COMPACTION OF MATERIALS FOR ITEMS NOS. 200 (4) AND 217 (1), INVOLVING A TOTAL OF 49,500 TONS OF MATERIAL AND IT SHOWS A TOTAL INCREASED COST OF $4,950 FOR THESE ITEMS AS A RESULT OF THE OMISSION. HERE AGAIN, YOU REPORT THAT THE SPECIFICATIONS REQUIRE THE COST OF COMPACTION TO BE INCLUDED IN THE UNIT PRICES FOR THESE ITEMS. NOTWITHSTANDING THIS REQUIREMENT THERE IS NO INDICATION ON THE WORK SHEETS THAT THE COMPACTION COSTS WERE INCLUDED.

KNISELY-MOORE ALSO ALLEGES THAT ITS INDIRECT COSTS DO NOT CONTAIN ANY AMOUNT FOR STRIPPING PITS WHICH ALSO SHOULD HAVE CONTAINED A COST FOR THE CLEANUP OF PITS, AS REQUIRED. AS STATED BY YOU, WE FIND NOTHING ON THE WORK SHEETS TO REFLECT ANY COST FOR PIT STRIPPING OR CLEANUP OF PITS. YOU REPORT THAT THESE FEATURES EXIST ON THE PROJECT AND THE COMPANY SHOWS AN INCREASED COST OF $7,500 FOR THIS ITEM.

IN ADDITION TO THE FOREGOING ERRORS, THE KNISELY-MOORE COMPANY CLAIMS AN ADDITIONAL MINOR ERROR INVOLVING INCREASED COSTS OF $136 ON ITEM NO. 534 (2), BITUMINOUS RUNDOWNS, AND AN INCREASED COST ERROR OF $42,055.05, WHICH IT IS NOTED TO BE A QUESTIONABLE ERROR IN YOUR JUDGMENT SINCE IT APPEARS TO INVOLVE NOTHING MORE THAN AN EVALUATION OF CONDITIONS ON THE PROJECT. BE THAT AS IT MAY, IT FURTHER APPEARS THAT THE EXPLANATION AS TO HOW THE ERRORS OCCURRED ON THE FIRST THREE ITEMS SET FORTH ABOVE, TOTALING $54,375, IS SUBSTANTIATED BY THE COMPANY'S WORK SHEETS. THIS, TOGETHER WITH THE FACT THAT THE BID OF THE COMPANY WAS CONSIDERABLY LOWER THEN THE RANGE IN PRICES SUBMITTED BY THE OTHER BIDDERS AND THE GOVERNMENT'S ESTIMATE FOR THE PROJECT, MAY BE ACCEPTED AS ESTABLISHING THAT ERRORS WERE, IN FACT, MADE IN THE BID OF THE COMPANY, AS ALLEGED. WHILE THE CONCLUSION IS REACHED THAT THE ERRORS WERE MADE, THE RECORD IS NOT SUCH AS TO DEFINITELY ESTABLISH WHAT THE EXACT BID OF THE KNISELY-MOORE COMPANY WOULD HAVE BEEN HAD THE ERRORS NOT OCCURRED AND, THEREFORE, CORRECTION OF THE BID IS NOT AUTHORIZED.

ACCORDINGLY, THE BID OF THE KNISELY-MOORE COMPANY IN THE AMOUNT OF $674,560 MAY BE DISREGARDED IN MAKING THE AWARD.