B-148992, JUN 20, 1962

B-148992: Jun 20, 1962

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TO DIMOND AND THORMAN: REFERENCE IS MADE TO YOUR LETTERS OF MAY 23. THE FISHING VESSEL IN QUESTION WILL BE CONSTRUCTED PURSUANT TO THE PROVISIONS OF PUBLIC LAW 86-516. UNDER WHICH THE DEPARTMENT OF THE INTERIOR IS AUTHORIZED TO GRANT CONSTRUCTION DIFFERENTIAL SUBSIDY AID IN THE CONSTRUCTION OF CERTAIN FISHING VESSELS. SECTION 7 OF THE ACT PROVIDES THAT ALL CONSTRUCTION WITH RESPECT TO WHICH A CONSTRUCTION SUBSIDY IS GRANTED UNDER THE ACT "SHALL BE PERFORMED IN A SHIPYARD IN THE UNITED STATES AS A RESULT OF COMPETITIVE BIDDING. A COPY OF WHICH WAS ENCLOSED WITH YOUR LETTER OF THE SAME DATE TO THIS OFFICE. YOU STATE THAT THE INVITATION FOR BIDS WAS DATED MARCH 19. THAT SEALED BIDS WERE OPENED APRIL 4.

B-148992, JUN 20, 1962

TO DIMOND AND THORMAN:

REFERENCE IS MADE TO YOUR LETTERS OF MAY 23, 1962, WITH ENCLOSURES, AND MAY 28, 1962, PROTESTING ON BEHALF OF YOUR CLIENT, FRANK L. SAMPLE AND SON, INC., A PROPOSED AWARD OF A CONTRACT FOR THE CONSTRUCTION OF A FISHING VESSEL FOR THE JACOBSON FISHING CO., INC., TO STONINGTON DEER ISLAND YACHT BASIN, INC.

THE FISHING VESSEL IN QUESTION WILL BE CONSTRUCTED PURSUANT TO THE PROVISIONS OF PUBLIC LAW 86-516, 74 STAT. 212, UNDER WHICH THE DEPARTMENT OF THE INTERIOR IS AUTHORIZED TO GRANT CONSTRUCTION DIFFERENTIAL SUBSIDY AID IN THE CONSTRUCTION OF CERTAIN FISHING VESSELS. SECTION 7 OF THE ACT PROVIDES THAT ALL CONSTRUCTION WITH RESPECT TO WHICH A CONSTRUCTION SUBSIDY IS GRANTED UNDER THE ACT "SHALL BE PERFORMED IN A SHIPYARD IN THE UNITED STATES AS A RESULT OF COMPETITIVE BIDDING, AFTER DUE ADVERTISING, WITH THE RIGHTS RESERVED IN THE APPLICANT, AND IN THE MARITIME ADMINISTRATOR, TO DISAPPROVE ANY OR ALL BIDS.' UNDER THE ACT THE MARITIME ADMINISTRATION APPROVES THE INVITATION FOR BIDS, THE PRO FORMA CONTRACT, RECEIVES THE BIDS, DETERMINES THE LOWEST RESPONSIBLE BIDDER AND DETERMINES THE ESTIMATED FOREIGN COST FOR THE DEPARTMENT OF THE INTERIOR.

IN YOUR LETTER DATED MAY 23, 1962, TO THE CHIEF, OFFICE OF SHIP CONSTRUCTION, MARITIME ADMINISTRATION, A COPY OF WHICH WAS ENCLOSED WITH YOUR LETTER OF THE SAME DATE TO THIS OFFICE, YOU STATE THAT THE INVITATION FOR BIDS WAS DATED MARCH 19, 1962; THAT SEALED BIDS WERE OPENED APRIL 4, 1962; AND THAT THERE WERE TWO BIDDERS ON THE SPECIFICATIONS: STONINGTON DEER ISLAND YACHT BASIN, INC., WHOSE BID WAS $230,900 AND FRANK L. SAMPLE AND SON, INC., WHOSE BID WAS $234,750. YOU FURTHER STATE THAT ON MARCH 5, 1962, AT A CONFERENCE HELD IN THE OFFICE OF DWIGHT S. SIMPSON AND ASSOCIATES, NAVAL ARCHITECTS FOR JACOBSON FISHING CO., INC. (THE APPLICANT FOR THE CONSTRUCTION SUBSIDY FOR WHOM THE VESSEL WILL BE BUILT), AGREEMENT WAS REACHED BETWEEN JACOBSON FISHING CO., INC., AND FRANK L. SAMPLE AND SON, INC., TO MODIFY THE SPECIFICATIONS TO PROVIDE FOR SUBSTANTIAL CHANGES IN CONSTRUCTION WHICH WOULD REDUCE THE COST OF THE VESSEL APPROXIMATELY $20,000. IN YOUR LETTER DATED MAY 28, 1962, YOU STATE THAT AS A RESULT OF THESE SUBSTANTIAL CHANGES IN THE SPECIFICATIONS THERE IS A QUESTION AS TO WHETHER THE MARITIME ADMINISTRATION CAN REQUEST SEALED BIDS ON THE NEW REVISED SPECIFICATIONS FROM THE TWO BIDDERS OR WHETHER IT IS REQUIRED TO READVERTISE. YOU CONTEND THAT IF THE MARITIME ADMINISTRATION IS PERMITTED TO SEEK REVISED BIDS FROM THE TWO BIDDERS, THESE BIDS COULD BE SUBMITTED WITHIN A MATTER OF A FEW DAYS BUT IF THE ADMINISTRATION IS REQUIRED TO READVERTISE, IT WOULD TAKE A CONSIDERABLE PERIOD OF TIME AND UNDULY DELAY THE JACOBSON FISHING CO., INC. AND, FINALLY, ASSUMING THAT THE JACOBSON FISHING CO., INC., IS WILLING TO ENTER INTO A CONTRACT WITH EITHER OF THE TWO BIDDERS BASED UPON THE LOW BID PRICE SUBMITTED ON THE REVISED SPECIFICATIONS, YOU ASK IF THERE IS ANY OBJECTION UPON THE PART OF THIS OFFICE TO THE MARITIME ADMINISTRATION OBTAINING SEALED BIDS ON THE REVISED SPECIFICATIONS FROM THE TWO BIDDERS.

BY LETTER DATED JUNE 4, 1962, FROM THE MARITIME ADMINISTRATION WE ARE INFORMED THAT THE STONINGTON DEER ISLAND YACHT BASIN, INC., WAS THE LOWEST RESPONSIBLE BIDDER AND THE DEPARTMENT OF THE INTERIOR WAS SO ADVISED BY THE MARITIME ADMINISTRATION. AS A CONSEQUENCE OF YOUR PROTEST, THE MARITIME ADMINISTRATION ALSO ADVISED THE DEPARTMENT OF THE INTERIOR THAT IT WAS IMPROPER FOR THE OWNER, THE JACOBSON FISHING CO., INC., TO NEGOTIATE WITH THE LOW BIDDER FOR A CHANGE IN THE BOAT'S SPECIFICATIONS TO BE EFFECTED BY A PRICE-REDUCING CHANGE FOLLOWING AWARD. IT IS FURTHER REPORTED THAT THE DEPARTMENT OF THE INTERIOR HAS ADVISED THE OWNER THAT ONLY AN AWARD ON THE PLANS AND SPECIFICATIONS AS BID, WITHOUT SUBSEQUENT CHANGE IN THE SPECIFICATIONS MAKING EFFECTIVE THE DELETIONS BEING NEGOTIATED, WILL BE PERMITTED IF SUBSIDY IS TO BE GRANTED. THE OWNER WAS ALSO ADVISED THAT THE OWNER MIGHT REJECT ALL BIDS AND REBID UPON THE BASIS OF CHANGED PLANS AND SPECIFICATIONS. AND, FINALLY, IT IS REPORTED THAT THE OWNER IS PROCEEDING WITH AN AWARD UPON THE BASIS OF THE PLANS AND SPECIFICATIONS AS BID AND THAT NO CHANGE COVERING THE PROPOSED DELETED WORK WILL BE APPROVED.

IN VIEW OF THESE DEVELOPMENTS, IT IS UNNECESSARY FOR THIS OFFICE TO DECIDE WHETHER THE MARITIME ADMINISTRATION MAY OBTAIN BIDS ON THE REVISED SPECIFICATIONS FROM THE TWO BIDDERS IN LIEU OF READVERTISING THE PROCUREMENT SINCE THIS QUESTION IS BASED UPON A STATE OF FACTS WHICH DOES NOT NOW EXIST. ACCORDINGLY, YOUR PROTEST MUST BE, AND IS, DENIED.