B-147885, FEB. 16, 1962

B-147885: Feb 16, 1962

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INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 3. - PRICE BID FOR USED MACHINE ON PAGE 2 OF THE SCHEDULE (STANDARD FORM 31) IS THE FOLLOWING PROVISION: "TRADE IN ALLOWANCE: THE GOVERNMENT RESERVES THE RIGHT TO MAKE AWARD ON THE BASIS OF THE EQUIPMENT TO BE PROCURED. OR COMBINATION OF BIDS WHICH WILL RESULT IN THE LOWEST NET COST TO THE GOVERNMENT FOR THAT ITEM. "2. OR (II) A BIDDER MAY BID HIS BEST NET PRICE AFTER ALLOWING TRADE-IN CREDIT FOR THE EXCHANGE/SALE PROPERTY ASSOCIATED WITH THE ITEM ON WHICH HE IS PLACING A BID. THE BIDS RECEIVED IN RESPONSE TO THE INVITATION HAVE BEEN EVALUATED BY THE ADMINISTRATIVE OFFICE AS FOLLOWS: "A. 383.75 " IT IS STATED BY THE DEPARTMENT THAT ALTHOUGH THE PRICE FOR THE SALE OF THE USED MACHINE (ITEM NO. 3) HAS BEEN NEGOTIATED UPWARD TO THE FAIR MARKET VALUE WITH BOND INDUSTRIAL MACHINERY COMPANY.

B-147885, FEB. 16, 1962

TO MACHINERY ASSOCIATES, INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 3, 1962, PROTESTING AGAINST AWARD OF A CONTRACT TO ANY OTHER BIDDER UNDER INVITATION NO. IFB600-526-62 ISSUED NOVEMBER 20, 1961, BY THE U.S. NAVY PURCHASING OFFICE.

THE INVITATION REQUESTED BIDS--- TO BE OPENED DECEMBER 11, 1961--- COVERING THREE ITEMS AS FOLLOWS:

ITEM NO. 1--- PRECISION TOOLROOM LATHE

ITEM NO. 2--- TRADE-IN ALLOWANCE FOR USED MACHINE

ITEM NO. 3--- PRICE BID FOR USED MACHINE

ON PAGE 2 OF THE SCHEDULE (STANDARD FORM 31) IS THE FOLLOWING PROVISION:

"TRADE IN ALLOWANCE: THE GOVERNMENT RESERVES THE RIGHT TO MAKE AWARD ON THE BASIS OF THE EQUIPMENT TO BE PROCURED, ITEM 1 WITH OR WITHOUT TRADE IN COVERED BY ITEM 2 AS MAY BE MOST ADVANTAGEOUS TO THE GOVERNMENT.'

THE TERMS AND CONDITIONS MADE A PART OF THE INVITATION PROVIDE IN PART:

"1. WITH RESPECT TO ANY ITEM COVERED BY THIS INVITATION, THE GOVERNMENT RESERVES THE RIGHT TO REJECT ANY AND ALL BIDS AND TO ACCEPT THE BID, OR BIDS, OR COMBINATION OF BIDS WHICH WILL RESULT IN THE LOWEST NET COST TO THE GOVERNMENT FOR THAT ITEM.

"2. BIDS MAY BE MADE IN ANY OF SEVERAL WAYS: (I) A SUPPLIER MAY BID FOR THE FURNISHING OF ANY ITEM WITHOUT REGARD TO ANY EXCHANGE OR TRADE-IN CREDIT ALLOWANCE ON ACCOUNT OF PROPERTY AVAILABLE FOR TRADE IN AS SHOWN IN THE INVITATION; OR (II) A BIDDER MAY BID HIS BEST NET PRICE AFTER ALLOWING TRADE-IN CREDIT FOR THE EXCHANGE/SALE PROPERTY ASSOCIATED WITH THE ITEM ON WHICH HE IS PLACING A BID; (IN THIS INSTANCE SHOW TWO (2) PRICES, I.E., PRICE FOR ITEM WITHOUT ALLOWANCE AND PRICE FOR ITEM 1 WITH ALLOWANCE); OR (III) HE MAY BID FOR ONLY THE PURCHASE OF THE EXCHANGE/SALE PROPERTY; OR HE MAY PLACE A BID IN ONE OR MORE OF THE THREE WAYS INDICATED. BIDS MAY ALSO BE MADE BY USED MACHINE TOOL DEALERS, REBUILDERS, OR BY INDIVIDUALS HAVING NEITHER THE ABILITY NOR THE DESIRE TO FURNISH THE NEW ITEM.'

THE BIDS RECEIVED IN RESPONSE TO THE INVITATION HAVE BEEN EVALUATED BY THE ADMINISTRATIVE OFFICE AS FOLLOWS:

"A. LOW:

ITEM 1, BARBER- COLMAN COMPANY $10,091.00

LESS ITEM 3, BOND INDUSTRIAL 359.99

MACHINERY CO. $ 9,731.01

"B. 2ND LOW:

ITEM 1, CAREY MACHINERY AND SUPPLY CO., INC.

10,195.58

LESS ITEM 2, CAREY MACHINERY AND 450.00

SUPPLY CO. INC. 9,745.58

"C. 3RD LOW:

ITEM 1, MACHINERY ASSOC., INC. 10,425.00

LESS ITEM 2, MACHINERY ASSOCIATES, 650.00

INC. 9,775.00

"D. 4TH LOW:

ITEM 1, CAREY MACHINERY AND SUPPLY CO., INC.

10,195.58

LESS ITEM 3, BOND INDUSTRIAL 359.99

MACH. CO. 9,835.59

"E. 5TH LOW:

ITEM 1, DELAWARE VALLEY MACHINERY, INC. 10,201.85

LESS ITEM 3, BOND INDUSTRIAL 359.99

MACHINERY CO. 9,841.86

"F. 6TH LOW:

ITEM 1, DELAWARE VALLEY MACHINERY, INC. 10,201.85

LESS ITEM 2, DELAWARE VALLEY 350.00

MACHINERY, INC. 9,851.85

"G. 7TH LOW:

ITEM 1, BARBER-COLMAN CO. 10,091.00

LESS ITEM 2, BARBER-COLMAN CO. 75.00

10,016.00

"H. 8TH LOW:

ITEM 1, W. E. SHIPLEY MACHINERY CO. 10,383.75

LESS ITEM 3, BOND INDUSTRIAL 359.99

MACHINERY CO. 10,023.76

"I. 9TH LOW:

ITEM 1, MACHINERY ASSOCIATES, INC. 10,425.00

LESS ITEM 3, BOND INDUSTRIAL 359.99

MACHINERY CO. 10,065.01

"J. HIGH:

ITEM 1, W. E. SHIPLEY MACHINERY CO. 10,383.75

ITEM 2, W. E. SHIPLEY MACHINERY CO., NO

BID 0.00

$10,383.75 "

IT IS STATED BY THE DEPARTMENT THAT ALTHOUGH THE PRICE FOR THE SALE OF THE USED MACHINE (ITEM NO. 3) HAS BEEN NEGOTIATED UPWARD TO THE FAIR MARKET VALUE WITH BOND INDUSTRIAL MACHINERY COMPANY, THE ONLY BIDDER ON THAT ITEM, THE EVALUATION WAS MADE ON THE BASIS OF THE ORIGINAL BIDS. IS STATED FURTHER THAT AWARD HAS NOT BEEN MADE BUT THAT THE CONTRACTING OFFICER PROPOSES TO AWARD ITEM NO. 1 TO BARBER-COLMAN COMPANY AND ITEM NO. 3 TO BOND INDUSTRIAL MACHINERY COMPANY.

AS SHOWN BY THE EVALUATION OF BIDS ABOVE SET OUT, THE PROPOSED AWARD TO BARBER-COLMAN COMPANY AND BOND INDUSTRIAL MACHINERY COMPANY WOULD RESULT IN THE LOWEST NET COST TO THE GOVERNMENT. THEREFORE, AND IN VIEW OF THE ABOVE-QUOTED PROVISIONS OF THE INVITATION SPECIFICALLY AUTHORIZING THE ACCEPTANCE OF "THE BID, OR BIDS, OR COMBINATION OF BIDS" WHICH WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, THE PROPOSED AWARD APPEARS TO BE PROPER AND REQUIRED. THE ADDITIONAL COST OF PROCESSING TWO CONTRACTS INSTEAD OF ONE, REFERRED TO IN YOUR LETTER, IS SO UNCERTAIN AS TO BE PRACTICALLY INCAPABLE OF DEFINITE COMPUTATION. MOREOVER, IN ADDITION TO THE DIFFERENCE OF $43.99 BETWEEN THE AMOUNT OF YOUR BID AND THE NET COST TO THE GOVERNMENT UNDER THE PROPOSED AWARD TO TWO BIDDERS, THERE IS FOR CONSIDERATION THE NEGOTIATED INCREASE IN THE SALE PRICE OF THE USED MACHINE ABOVE MENTIONED.