B-149164, JUL. 11, 1962

B-149164: Jul 11, 1962

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ADMINISTRATION: REFERENCE IS MADE TO YOUR LETTER OF JUNE 13. IT IS ADMINISTRATIVELY REPORTED THAT OVER AN HOUR AFTER THE BID OPENING A REPRESENTATIVE OF THE A AND A AMBULANCE SERVICE ORALLY REQUESTED PERMISSION TO WITHDRAW ITS BID AND STATED THAT THE OFFER OF A PROMPT PAYMENT DISCOUNT WAS A MISTAKE. THE ALLEGATION OF ERROR IS SHOWN TO HAVE BEEN CONFIRMED IN WRITING BY THE BIDDER'S LETTER. THE RATES QUOTED BY BIDDERS FOR THE ADVERTISED AMBULANCE SERVICES ARE IDENTICAL. ARE PRECLUDED UNDER PRESCRIBED PENALTIES FROM QUOTING ANY PRICE FOR SERVICES OTHER THAN THE UNIFORM RATE FIXED BY THE COMMISSION. UNLESS UPON A CARRIER'S SPECIFIC REQUEST A REDUCED RATE IS APPROVED BY THE COMMISSION. IT IS STATED.

B-149164, JUL. 11, 1962

ADMINISTRATION:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 13, 1962 (FILE REFERENCE 031C), WITH ENCLOSURES, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING THE BIDS SUBMITTED IN RESPONSE TO INVITATIONS ISSUED BY THE VETERANS ADMINISTRATION HOSPITAL, TUCSON, ARIZONA, FOR AMBULANCE AND TAXI SERVICE FOR THE PERIOD JULY 1, 1962, THROUGH JUNE 30, 1963.

INVITATION NO. 63-6, BEARING BID OPENING DATE OF MAY 18, 1962, REQUESTED BIDS COVERING BOTH DAY AND NIGHT RATES FOR AMBULANCE SERVICE FOR (1) EACH TRIP ENTIRELY WITHIN THE CITY LIMITS AND (2) THE RATE PER MILE FOR TRIPS BEYOND THE CITY LIMITS. THE RECORD SHOWS THAT OF THE SIX BIDS RECEIVED, EXCEPT FOR A PROMPT PAYMENT DISCOUNT OFFERED BY THE A AND A AMBULANCE SERVICE AND THE RATE QUOTED BY THE ADAIR FUNERAL HOME OF $0.67 PER MILE ON TRIPS BEYOND THE CITY LIMITS, THE BIDDERS QUOTED IDENTICAL PRICES OF $12.50 FOR ANY TRIP ENTIRELY WITHIN THE CITY LIMITS AND, ON TRIPS BEYOND THE CITY LIMITS, IN ADDITION TO THE SUM OF$12.50 COVERING THE FIRST FIVE MILES, $1.00 PER MILE FOR THE NEXT 30 MILES AND $0.50 FOR EACH MILE THEREAFTER. IT IS ADMINISTRATIVELY REPORTED THAT OVER AN HOUR AFTER THE BID OPENING A REPRESENTATIVE OF THE A AND A AMBULANCE SERVICE ORALLY REQUESTED PERMISSION TO WITHDRAW ITS BID AND STATED THAT THE OFFER OF A PROMPT PAYMENT DISCOUNT WAS A MISTAKE. THE ALLEGATION OF ERROR IS SHOWN TO HAVE BEEN CONFIRMED IN WRITING BY THE BIDDER'S LETTER, APPARENTLY HAND- DELIVERED ON THE BID OPENING DATE. THE RECORD FURTHER SHOWS THAT THE ADAIR FUNERAL HOME, BY LETTER DATED MAY 22, 1962, ALLEGED THAT IT HAD MISINTERPRETED THE BID REQUIREMENTS; THAT IT ARIZONA CORPORATION COMMISSION; AND REQUESTED THAT BY REASON THEREOF ITS BID BE DISREGARDED IN THE AWARD MADE UNDER THE INVITATION. THE BIDS OF THESE TWO FIRMS, AS CORRECTED, WOULD BE IDENTICAL WITH THE BIDS RECEIVED FROM THE OTHER FOUR BIDDERS.

CONCERNING THE FACT THAT, WITH THE EXCEPTIONS NOTED, THE RATES QUOTED BY BIDDERS FOR THE ADVERTISED AMBULANCE SERVICES ARE IDENTICAL, IT APPEARS THAT UNDER THE LAWS OF THE STATE OF ARIZONA, VESTING IN THE ARIZONA CORPORATION COMMISSION THE POWER AND AUTHORITY TO SUPERVISE AND REGULATE ALL COMMON MOTOR CARRIERS, SUCH CARRIERS, INCLUDING AMBULANCE OPERATORS, ARE PRECLUDED UNDER PRESCRIBED PENALTIES FROM QUOTING ANY PRICE FOR SERVICES OTHER THAN THE UNIFORM RATE FIXED BY THE COMMISSION, UNLESS UPON A CARRIER'S SPECIFIC REQUEST A REDUCED RATE IS APPROVED BY THE COMMISSION. WITH RESPECT TO THE BIDS RECEIVED UNDER THIS INVITATION, THE FILE TRANSMITTED TO THIS OFFICE INCLUDES A COPY OF LETTER OF MAY 25, 1962, FROM THE ARIZONA CORPORATION COMMISSION, WHEREIN, IN RESPONSE TO THE HOSPITAL'S INFORMAL INQUIRY, IT IS STATED, IN EFFECT, THAT AMBULANCE CARRIERS, QUOTING RATES OTHER THAN THOSE APPROVED BY THE COMMISSION, ARE REGARDED AS IN VIOLATION OF LAW.

UNDER THE REPORTED FACTS AND CIRCUMSTANCES, THE EVIDENCE OF RECORD MAY BE ACCEPTED AS ESTABLISHING THAT THE A AND A AMBULANCE SERVICE AND THE ADAIR FUNERAL HOME, IN QUOTING RATES OTHER THAN THOSE APPROVED BY THE COMMISSION, DID IN FACT MAKE A MISTAKE IN BID AS ALLEGED. IN VIEW THEREOF, AND OF THE ALLEGATION OF ERROR PRIOR TO AWARD, THEIR BIDS, PURSUANT TO THEIR REQUEST, MAY BE DISREGARDED IN ANY AWARD MADE UNDER THE INVITATION. IN THAT CONNECTION, THE PAPERS TRANSMITTED BY YOU TO THIS OFFICE INCLUDE A COPY OF LETTER OF JUNE 1, 1962, FROM THE HOSPITAL DIRECTOR, WHEREIN REFERENCE IS MADE TO THE FACT THAT, WITH THE APPROVAL OF THE ARIZONA CORPORATION COMMISSION, THE CONTRACT FOR AMBULANCE SERVICES COVERING THE PERIOD EXPIRING JUNE 30, 1962, PROVIDED FOR A RATE OF $3.49 FOR ANY TRIP WITHIN CITY LIMITS AND $0.49 PER MILE THEREAFTER. BASED ON THE HOSPITAL'S ESTIMATED REQUIREMENTS FOR AMBULANCE SERVICES DURING THE FISCAL YEAR 1963, AS SET FORTH IN THE INVITATION HERE INVOLVED, AWARD THEREUNDER AT THE PRICES QUOTED WILL RESULT IN THE PAYMENT OF APPROXIMATELY $5,500 IN EXCESS OF THAT WHICH WOULD BE PAID AT THAT POTENTIAL SUPPLIERS OF AMBULANCE SERVICES HAVE BEEN ADVISED OF THE POSSIBILITY OF OBTAINING THE COMMISSION'S APPROVAL FOR QUOTING REDUCED RATES TO MEET THE HOSPITAL'S REQUIREMENTS OR THAT ANY OF THE BIDDERS HAVE INDEPENDENTLY TAKEN SUCH ACTION. IN ANY EVENT, IF IT BE ADMINISTRATIVELY DETERMINED THAT THE BID PRICES RECEIVED IN RESPONSE TO THIS INVITATION ARE UNREASONABLE AND THAT, UPON APPLICATION OF LOCAL AMBULANCE CARRIERS, THE COMMISSION MAY APPROVE THE QUOTATION OF REDUCED RATES TO THE HOSPITAL, ALL BIDS SHOULD BE REJECTED AND THE REQUIREMENT FOR AMBULANCE SERVICES READVERTISED.

INVITATION NO. 63-8, BEARING BID OPENING DATE OF MAY 23, 1962, REQUESTED BIDS FOR THE FURNISHING OF THE HOSPITAL'S ESTIMATED TAXI REQUIREMENTS FOR THE FISCAL YEAR 1963. CONCERNING THE RATES TO BE QUOTED BY BIDDERS, THE INVITATION INCLUDED THE FOLLOWING PROVISION:

"RATES: THE RATES FURNISHED BY BIDDERS MUST BE THOSE CURRENTLY IN EFFECT, AS APPROVED BY THE ARIZONA CORPORATION COMMISSION.'

OF THE TWO BIDS RECEIVED IN RESPONSE TO THE INVITATION, THE LOW BID OF CITIZEN TAXI, IN APPARENT RECOGNITION THAT THE RATES QUOTED THEREIN WERE LESS THAN, AND AT VARIANCE WITH, THOSE APPROVED BY THE COMMISSION, CONTAINED THE STATEMENT THAT ITS BID WAS "* * * IN ACCORDANCE WITH ARTICLE 15 SECTION 12 OF CONSTITUTION OF STATE OF ARIZONA AND SECTION 22 OF THE INTERSTATE COMMERCE ACT, GRANTING GOVERNMENT AGENCIES A SPECIAL REDUCED RATE UNDER THESE ACTS.' THE RECORD SHOWS THAT, IN RESPONSE TO THE HOSPITAL'S REQUEST FOR ADVICE AS TO WHETHER THE RATES QUOTED BY CITIZEN TAXI WERE "ACCEPTABLE," IT WAS ADVISED, IN SUBSTANCE, BY THE ARIZONA CORPORATION COMMISSION THAT THE RATES WERE DEEMED CONTRARY TO AND IN VIOLATION OF THOSE APPROVED BY THE COMMISSION.

WHILE, ON THE BASIS OF THE FACTS OF RECORD, THERE IS A DIFFERENCE OF OPINION BETWEEN THE COMMISSION AND THE BIDDER AS TO THE COMPLIANCE OF THE BID WITH STATUTORY REQUIREMENTS, OUR DECISIONS HAVE BEEN CONSISTENT IN APPLYING THE RULE THAT THE COMPLIANCE BY BIDDERS ON GOVERNMENT CONTRACTS WITH THE PROVISIONS OF STATE AND LOCAL STATUTES OR REGULATIONS IS A MATTER BETWEEN THE BIDDERS AND THE LOCAL AUTHORITIES AND NOT ONE TO BE RESOLVED OR REQUIRED AS A PREREQUISITE TO THE CONSIDERATION OF BIDS. 36 COMP. GEN. 218; 35 ID. 411; 19 ID. 735; 16 ID. 97; 15 ID. 425. WE HAVE ALSO REPEATEDLY HELD THAT, CONSISTENT WITH THE RIGHT OF THE GOVERNMENT TO FREE AND OPEN COMPETITION IN THE AWARD OF CONTRACTS FOR SERVICES AND SUPPLIES, AN INVITATION FOR BIDS, IN THE ABSENCE OF AN AUTHORITATIVE JUDICIAL DETERMINATION TO THE CONTRARY, MAY NOT RESTRICT THE COMPETITION TO BIDDERS QUOTING RATES PRESCRIBED OR APPROVED BY STATE PRICE-FIXING AGENCIES. COMP. GEN. 97; ID. 348. IN THE LATTER NOT BE APPROVED FOR THE MAKING OF ANY PAYMENTS UNDER AWARDS MADE AFTER CONTAIN A RESTRICTIVE REQUIREMENT OF SHOWING COMPLIANCE WITH STATE PURCHASED BY THE UNITED STATES.'

IN THE LIGHT OF THE ABOVE DECISIONS, WE HAVE NO ALTERNATIVE BUT TO HOLD THAT, SINCE THE INVITATION HERE INVOLVED IS RESTRICTIVE AND, BY THE ARIZONA CORPORATION COMMISSION," NO AWARD MAY PROPERLY BE MADE THEREUNDER. ACCORDINGLY, THE BIDS RECEIVED UNDER THE INVITATION SHOULD BE REJECTED AND, IF THE PROCUREMENT IS READVERTISED, THE COVERING INVITATION SHOULD BE APPROPRIATELY REVISED.