B-149610, DEC. 11, 1962

B-149610, DEC. 11, 1962

TO ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

WE REFER TO OUR TELEPHONE CALL OF AUGUST 3, 1962, LETTERS OF AUGUST 6 AND 10, 1962, AND SUBSEQUENT CONFERENCES WITH RESPONSIBLE MEMBERS OF THE PUBLIC BUILDINGS SERVICE, CONCERNING A PROTEST FILED ON BEHALF OF BURMAN, CAMPITELLI AND BRISKER (BCB) AGAINST THE FAILURE OF THAT FIRM TO OBTAIN AN AWARD UNDER INVITATION FOR BIDS NO. GS-PBS-03-562. THE MATTER WAS ALSO THE SUBJECT OF A LETTER OF SEPTEMBER 13, 1962, FROM THE COMMISSIONER, PUBLIC BUILDINGS SERVICE.

THE INVITATION WAS ISSUED ON FEBRUARY 16, 1962, FOR LEASING BY THE GOVERNMENT OF UPWARDS 600,000 NET USABLE SQUARE FEET OF GENERAL OFFICE AND RELATED SPACE IN THE WASHINGTON, D.C., AREA. THE SPACE WAS REQUIRED TO BE FURNISHED IN UNITS OR COMBINATIONS THEREOF OF APPROXIMATELY 20,000, 40,000, 60,000, 80,000, OR 125,000 NET USABLE SQUARE FEET. THE GOVERNMENT WAS TO TAKE POSSESSION NO LATER THAN APRIL 1, 1963, FOR A FIRM 5-YEAR TERM WITH ANNUAL RENEWALS, OR A 10-YEAR FIRM TERM. THE INVITATION WAS AMENDED BY ADDENDA ISSUED MARCH 10, 14 AND 16, 1962. IN ACCORDANCE WITH THE TERMS OF THE INVITATION AS AMENDED, BIDS WERE OPENED ON MARCH 27, 1962. WE HAVE BEEN ADVISED THAT EIGHT AWARDS WERE MADE UNDER THE INVITATION ON JUNE 26, 1962.

THE REJECTION OF THE BCB BID WAS PROTESTED IN WRITING TO THE PUBLIC BUILDINGS SERVICE ON BEHALF OF BCB BOTH PRIOR TO AND AFTER AWARDS. PROTEST WAS ALSO MADE TO OUR OFFICE ON AUGUST 2, 1962. THE RATHER CONSIDERABLE CORRESPONDENCE ON THE MATTER REVEALS FOUR BASES FOR THE PROTEST AS FOLLOWS:

1. TWO OF THE SUCCESSFUL BIDDERS SUBMITTED BID BONDS WHICH DID NOT MEET THE REQUIREMENTS OF THE INVITATION.

2. THE METHOD EMPLOYED FOR THE EVALUATION OF BIDS WAS NOT STATED IN THE INVITATION AND DID NOT RESULT IN AWARDS MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED;

3. AT LEAST ONE OF THE SUCCESSFUL BIDDERS DID NOT COMPLY WITH THE DATA FURNISHING REQUIREMENT OF THE INVITATION;

4. ONE OF THE SUCCESSFUL BIDDERS DID NOT BID ON THE 5-YEAR LEASE WITH RENEWAL OPTIONS, ALTHOUGH THE APPLICABLE LANGUAGE OF THE INVITATION APPEARED TO MAKE SUCH BID MANDATORY.

THE INVITATION FOR BIDS, AS AMENDED, REQUIRED THE SUBMISSION WITH THE BID OF A GUARANTEE AS FOLLOWS:

"BONDS

(A) BID GUARANTEE

BIDS MUST BE ACCOMPANIED BY A BID GUARANTEE OF NOT LESS THAN TWENTY (20) PERCENT OF THE HIGHEST ALTERNATE RENTAL PRICE QUOTED BY THE BIDDER FOR A ONE YEAR PERIOD. SUCH GUARANTEE SHALL BE SUBMITTED TO INSURE THAT THE BIDDER WILL NOT WITHDRAW HIS BID WITHIN THE TIME ALLOWED FOR ACCEPTANCE THEREOF AFTER THE DATE OF OPENING OF THE BIDS, AND, THAT IF THE BID IS ACCEPTED, HE WILL ENTER INTO A FORMAL LEASE ON U.S. STANDARD FORM NO. 2. FAILURE TO FURNISH A BID GUARANTEE IN THE PROPER FORM AND AMOUNT, BY THE TIME SET FOR OPENING OF BIDS, MAY BE CAUSE FOR REJECTION OF THE BID. BID GUARANTEE MAY BE IN THE FORM OF BID BOND, POSTAL MONEY ORDER, CERTIFIED CHECK, OR CASHIER'S CHECK MADE PAYABLE TO GENERAL SERVICES ADMINISTRATION, REGION 3. BID GUARANTEES, OTHER THAN BID BONDS, WILL BE RETURNED:

(1) TO UNSUCCESSFUL BIDDERS, AS SOON AS PRACTICABLE AFTER THE OPENING OF BIDS, AND

(2) TO THE SUCCESSFUL BIDDER UPON EXECUTION OF SUCH FURTHER CONTRACTUAL DOCUMENTS AND BONDS AS MAY BE REQUIRED BY THE BID AS ACCEPTED.

IF, UPON ACCEPTANCE OF HIS BID BY THE GOVERNMENT, THE SUCCESSFUL BIDDER FAILS TO ENTER INTO THE CONTRACT AND GIVE BOND/S) (AS HEREINAFTER SPECIFIED) WITHIN TEN (10) DAYS AFTER THE FORMS ARE PRESENTED TO HIM,HE SHALL BE LIABLE FOR ANY DIFFERENCE BY WHICH THE COST OF PROCURING THE SPACE EXCEEDS THE AMOUNT OF HIS BID, AND THE BID GUARANTEE SHALL BE AVAILABLE TOWARD OFFSETTING SUCH DIFFERENCE.

(B) PERFORMANCE BOND--- WITHIN TEN DAYS FROM AWARD, THE SUCCESSFUL BIDDER SHALL SUBMIT A PERFORMANCE BOND IN A PENAL SUM EQUAL TO ONE YEAR RENTAL UNDER THE CONTRACT.'

IN THE CASE OF TWO OF THE SUCCESSFUL BIDDERS BID BONDS WERE SUBMITTED WHICH INCLUDED THE FOLLOWING UNDERTAKING BY THE SURETY:

"NOW, THEREFORE, IF THE PRINCIPAL SHALL NOT WITHDRAW SAID BID WITHIN THE PERIOD SPECIFIED THEREIN AFTER THE OPENING OF THE SAME AND SHALL WITHIN THE PERIOD SPECIFIED THEREFOR EXECUTE SUCH FURTHER CONTRACTUAL DOCUMENTS, IF ANY, AS MAY BE REQUIRED BY THE TERMS OF THE BID AS ACCEPTED, AND GIVE BOND WITH GOOD AND SUFFICIENT SURETY OR SURETIES ON STANDARD FORM 25, MODIFIED IN ACCORDANCE WITH THE ATTACHED SPECIMEN COPY, OR IN THE EVENT OF THE WITHDRAWAL OF SAID BID WITHIN THE PERIOD SPECIFIED, OR THE FAILURE TO ENTER INTO SUCH CONTRACT AND GIVE SUCH BOND WITHIN THE TIME SPECIFIED, IF THE PRINCIPAL SHALL PAY THE GOVERNMENT THE DIFFERENCE, NOT TO EXCEED THE PENALTY HEREOF, BETWEEN THE AMOUNT OF ANNUAL RENT SPECIFIED IN SAID BID AND SUCH LARGER AMOUNT OF SAID RENT FOR WHICH THE GOVERNMENT MAY IN GOOD FAITH CONTRACT WITH ANOTHER PARTY FOR PREMISES CONTEMPLATED BY THE INVITATION TO BID, THEN THIS OBLIGATION SHALL BE NULL AND VOID, OTHERWISE TO REMAIN IN FULL FORCE AND EFFECT.'

IN A LETTER OF CLARIFICATION SUBMITTED AFTER OPENING BY THE SURETIES INVOLVED, THE POSITION WAS TAKEN THAT THE WORD "ANNUAL" INCLUDED IN THE APPLICABLE BID BOND WAS NOT INTENDED TO LIMIT THE RESPONSIBILITY OF THE SURETY TO A DIFFERENCE BETWEEN THE RENTAL FOR ONE YEAR AS BID AND AS MIGHT BE PAID BY THE GOVERNMENT UPON DEFAULT AND RELETTING.

THE POSITION OF YOUR AGENCY, STATED IN THE LETTER OF SEPTEMBER 13, 1962, APPEARS TO BE THAT THE BID BONDS IN QUESTION SHOULD NOT BE REGARDED AS NONRESPONSIVE EVEN IF THE TERM "ANNUAL" IS CONSTRUED TO LIMIT THE SURETY'S LIABILITY TO THE DIFFERENCE IN ONE YEAR'S RENTAL, AND THAT IN ANY CASE THE CLARIFICATION FURNISHED AFTER OPENING INSURED THAT THE PROTECTION REQUIRED UNDER THE TERMS OF THE INVITATION WOULD BE FURNISHED TO THE GOVERNMENT.

SINCE THE EFFECTIVE DATE OF OUR DECISION AT 38 COMP. GEN. 532, WE HAVE CONSISTENTLY APPLIED THE RULE, WITH CERTAIN EXCEPTIONS NOT HERE RELEVANT, THAT A BID GUARANTEE REQUIREMENT IS A MATERIAL PART OF AN INVITATION AND MUST BE ENFORCED AS WRITTEN. THE FACT THAT THE INVITATION USES A TERM WHICH IMPLIES THAT REJECTION WILL NOT OF NECESSITY FOLLOW FAILURE TO COMPLY WITH THE BID BOND REQUIREMENT DOES NOT CHANGE THE RULE. IN THIS INSTANCE THE BID GUARANTEE PROVISION USES THE PHRASE "MAY BE CAUSE FOR REJECTION.' SUCH LANGUAGE RENDERS THE REQUIREMENT AS MATERIAL AS IF A MORE POSITIVE EXPRESSION WERE EMPLOYED. 39 COMP. GEN. 827; B-148342, MARCH 29, 1962.

THE RULE IS THAT A BID BOND, TO BE ACCEPTABLE UNDER THE TERMS OF THE INVITATION, WHILE IT NEED NOT CONFORM IN EVERY RESPECT, MUST PROVIDE TO THE GOVERNMENT NOT LESS THAN THE DEGREE OF PROTECTION BOTH AS TO AMOUNT AND CONDITIONS REQUIRED BY SUCH TERMS. 39 COMP. GEN. 83.

IN OUR VIEW, THE UNDERTAKING REQUIRED FROM THE SURETY BY PARAGRAPH (A) (2) OF THE BOND PROVISION QUOTED ABOVE IS TO BE LIABLE, UPON A SUCCESSFUL BIDDER'S FAILURE TO GO FORWARD, FOR THE DIFFERENCE BETWEEN THE RENTAL UNDER SUCH BID AND A REPLACEMENT CONTRACT FOR THE ENTIRE LEASE PERIOD. DO NOT UNDERSTAND THAT A CONTRARY VIEW IS ENTERTAINED BY ANY OF THE INTERESTED PARTIES. THE SOLE QUESTION THEN IS WHETHER THE TWO QUESTIONED BONDS MAY BE CONSIDERED UNDERTAKINGS FOR THE DIFFERENCE IN RENTALS FOR THE ENTIRE LEASE PERIOD OR FOR ONLY A SINGLE YEAR. THE USE OF THE TERMS "AMOUNT OF ANNUAL RENT" AND "SAID RENT" INDICATES THE LATTER INTERPRETATION IS MORE REASONABLE. WHILE IT MAY BE ARGUED THAT THE QUOTED PHRASES REFER TO A RATE RATHER THAN AN ABSOLUTE AMOUNT, WE THINK IT SIGNIFICANT THAT THE TERM "RATE" WAS NOT USED IN EITHER PHRASE ALTHOUGH ITS INCLUSION WOULD CERTAINLY HAVE RESULTED IN A MUCH STRONGER ARGUMENT FOR THE PROPOSITION URGED.

MORE SIGNIFICANTLY, ALL BIDDERS SUBMITTED THEIR BID GUARANTEES ON STANDARD FORM 24, THE USUAL GOVERNMENT FORM FOR THE SUBMISSION OF BID BONDS. IN THAT FORM, THE UNDERTAKING OF THE SURETY IS STATED AS FOLLOWS:

"NOW THEREFORE, IF THE PRINCIPAL SHALL NOT WITHDRAW SAID BID WITHIN THE PERIOD SPECIFIED THEREIN AFTER THE OPENING OF THE SAME, OR, IF NO PERIOD BE SPECIFIED, WITHIN SIXTY (60) DAYS AFTER SAID OPENING, AND SHALL WITHIN THE PERIOD SPECIFIED THEREFOR, OR, IF NO PERIOD BE SPECIFIED, WITHIN TEN (10) DAYS AFTER THE PRESCRIBED FORMS ARE PRESENTED TO HIM FOR SIGNATURE, EXECUTE SUCH FURTHER CONTRACTUAL DOCUMENTS, IF ANY, AS MAY BE REQUIRED BY THE TERMS OF THE BID AS ACCEPTED, AND GIVE BONDS WITH GOOD AND SUFFICIENT SURETY OR SURETIES, AS MAY BE REQUIRED, FOR THE FAITHFUL PERFORMANCE AND PROPER FULFILLMENT OF THE RESULTING CONTRACT, AND FOR THE PROTECTION OF ALL PERSONS SUPPLYING LABOR AND MATERIAL IN THE PROSECUTION OF THE WORK PROVIDED FOR IN SUCH CONTRACT, OR IN THE EVENT OF THE WITHDRAWAL OF SAID BID WITHIN THE PERIOD SPECIFIED, OR THE FAILURE TO ENTER INTO SUCH CONTRACT AND GIVE SUCH BONDS WITHIN THE TIME SPECIFIED, IF THE PRINCIPAL SHALL PAY THE GOVERNMENT THE DIFFERENCE BETWEEN THE AMOUNT SPECIFIED IN SAID BID AND THE AMOUNT FOR WHICH THE GOVERNMENT MAY PROCURE THE REQUIRED WORK, SUPPLIES, AND SERVICES, IF THE LATTER AMOUNT BE IN EXCESS OF THE FORMER, THEN THE ABOVE OBLIGATION SHALL BE VOID AND OF NO EFFECT, OTHERWISE TO REMAIN IN FULL FORCE AND VIRTUE.' IN THE CASE OF THE TWO QUESTIONED BID BONDS, THE STANDARD FORM WAS USED BUT THE LANGUAGE QUOTED ABOVE WAS EXPRESSLY DELETED AND THAT QUOTED EARLIER SUBSTITUTED THEREFOR. IT WILL BE NOTED THAT THE SUBSTITUTED LANGUAGE DIFFERS BASICALLY IN TWO RESPECTS FROM THAT INCLUDED IN THE STANDARD FORM: (1) IT IS ADAPTED TO THE PARTICULAR PROCUREMENT, AND (2) THE LANGUAGE STATING THE QUANTUM OF THE SURETY'S UNDERTAKING, WHICH IN THE ORIGINAL CLEARLY COVERS THE ENTIRE LEASE PERIOD, HAS BEEN SUBSTANTIALLY CHANGED. THE FACT THAT THE LATTER CHANGE WAS SO SUBSTANTIAL WOULD TEND TO ESTABLISH AN INTENT TO CHANGE THE SCOPE OF THE UNDERTAKING SINCE, IF IT WERE INTENDED MERELY TO CONFORM THE LANGUAGE TO THE PROCUREMENT WITHOUT MATERIALLY AFFECTING THE UNDERTAKING OF THE SURETY, THE REVISED LANGUAGE COULD REASONABLY BE EXPECTED TO MORE NEARLY PARALLEL THE ORIGINAL.

WE CONCLUDE, THEREFORE, THAT THE LANGUAGE OF THE BID BOND SHOULD REASONABLY HAVE BEEN INTERPRETED AS LIMITING THE SURETY'S LIABILITY TO THE DIFFERENCE IN ONE YEAR'S RENTAL, WHEREAS THE INVITATION REQUIRES THAT THE SURETY BE LIABLE FOR THE DIFFERENCE IN RENTALS OVER THE ENTIRE LEASE TERM. THIS DIFFERENCE IS CERTAINLY MATERIAL AND, IN OUR VIEW, THE TWO BID BONDS IN QUESTION SHOULD HAVE BEEN REGARDED AS RENDERING THE BIDS NONRESPONSIVE. THE SO-CALLED LETTER OF CLARIFICATION HAVING BEEN FURNISHED AFTER OPENING, WHETHER VOLUNTARILY OR OTHERWISE, CANNOT, OF COURSE, HAVE ANY BEARING UPON THE RESPONSIVENESS OF THE BIDS IN QUESTION.

LETTERS FROM THE SURETIES ON THE TWO BONDS AT ISSUE, DATED OCTOBER 1 AND 2, 1962, RESPECTIVELY, INDICATE THAT THE SURETY IN EACH CASE WOULD HAVE FURNISHED THE BID BOND EVEN IF THE LANGUAGE OF THE UNDERTAKING HAD BEEN IDENTICAL WITH THAT STATED IN THE INVITATION. ON THE OTHER HAND, THE PROTESTING BIDDERS HAVE SUBMITTED A SIGNED STATEMENT FROM A SURETY REPRESENTATIVE INDICATING THAT THE QUALIFYING STANDARDS NORMALLY EMPLOYED BY SURETIES IN PROVIDING BID BONDS WOULD BE SUBSTANTIALLY DIFFERENT UNDER THE INVITATION REQUIREMENTS AND UNDER THE TWO BONDS IN QUESTION. SPECIFICALLY, IT IS CONTENDED THAT A BIDDER WOULD REQUIRE ASSETS FOUR TIMES AS GREAT TO QUALIFY UNDER THE BID BOND TERMS PROVIDED IN THE INVITATION. IN ANY CASE THE PROBABILITY THAT A BIDDER COULD HAVE OBTAINED THE REQUIRED BID BOND IS NOT A VALID TEST OF RESPONSIVENESS.

WE TURN NOW TO A CONSIDERATION OF THE BASIC PORTION OF THE INVITATION. THE FORM ON WHICH THE BID WAS TO BE SUBMITTED, GSA FORM 1364, STATES AT THE TOP:

"IN COMPLIANCE WITH AND SUBJECT TO THE PROVISIONS OF THE ABOVE IDENTIFIED INVITATION FOR BIDS, AND THE GENERAL PROVISIONS (GSA FORM 1363), AND SUCH ATTACHMENTS AND SCHEDULES LISTED IN BLOCK B-2 OF THE FIRST PAGE OF THE INVITATION (GSA FORM 1362), ALL WHICH ARE INCORPORATED HEREIN AND MADE A PART HEREOF, THE UNDERSIGNED BIDDER HEREBY OFFERS AND AGREES, UPON ACCEPTANCE OF THIS BID, WITHIN THE PERIOD SPECIFIED IN THE INVITATION, TO LEASE TO THE UNITED STATES OF AMERICA THE FOLLOWING-DESCRIBED PREMISES UPON THE TERMS AND CONDITIONS HEREIN SPECIFIED: "

BLOCK B-2, CITED IN THE FOREGOING QUOTATION, LISTS SCHEDULES A, B AND C, AND INVITATION FOR BIDS NO. GS-PBS-03-562. SCHEDULES A, B AND C ARE MADE UP SUBSTANTIALLY OF INSTRUCTIONS TO BIDDERS AND TECHNICAL SPECIFICATIONS. PARAGRAPH 5 OF SCHEDULE A REQUIRES THE SUBMISSION OF DATA AS FOLLOWS:

"5. BID DATA

BIDDER SHALL SET FORTH IN SPACE PROVIDED ON THE BID FORM OR ON ATTACHMENTS THERETO WHAT HE PROPOSES TO FURNISH UNDER EACH OF THE APPROPRIATE PARAGRAPHS OF THIS INVITATION.'

PARAGRAPH 11 OF SCHEDULE A, AS AMENDED, REQUIRES THE SUBMISSION OF CERTAIN DATA, AS FOLLOWS:

"11. INFORMATION TO BE SUBMITTED WITH BIDS BIDDERS MUST SUBMIT WITH THEIR BIDS:

(A) FOUR COPIES OF FLOOR PLANS TO A SCALE OF 1/8 INCH TO THE FOOT SHOWING THE SPACE OFFERED AS IT IS THEN LAID OUT, (INCLUDING COLUMN SPACING), OR AS IT IS PLANNED BY THE BIDDER, EXCLUSIVE OF INTERIOR OFFICE PARTITIONS.

(B) COMPLETED GSA FORM 1217 ATTACHED, COVERING ANY MAINTENANCE AND SERVICE COSTS SUPPLIED BY THE BIDDER.

(C) CAPACITY, SIZE, AND TYPE OF ELEVATOR/S).

(D) FLOOR LOAD CAPACITY SHALL BE INDICATED ON BID FORM, WHICH STATEMENT SHALL BE BINDING ON BIDDER.

(E) FULL DESCRIPTION AND ILLUSTRATION/S) OF THE QUALITY AND CHARACTER OF MATERIALS AND FACILITIES, INCLUDING BUT NOT LIMITED TO FLOOR COVERING, WINDOWS, DOORS, (EXTERIOR AND INTERIOR), HARDWARE, TYPE LIGHTING FIXTURES, TYPE PARTITIONS, AND INTERIOR FINISHES.

(F) CAPACITY, TYPE AND TRADE NAMES OF AIR CONDITIONING AND FILTERING EQUIPMENT.

(G) CEILING HEIGHT.

(H) GSA FORM 1732, ATTACHED HERETO.

(J) NUMBER OF PARKING SPACES INCLUDING NUMBER SQUARE FEET OFFERED FOR OFFICIAL USE. SEE SCHEDULE B, PART II, PARAGRAPH 14 (J).'

THE PARAGRAPH WAS FURTHER AMENDED TO PERMIT THE SUBMISSION AFTER OPENING OF DATA DESIGNATED IN ITEMS B AND H. FINALLY PARAGRAPH 15 OF SCHEDULE A RESTATES ONE OF THE DATA SUBMISSION REQUIREMENTS AS FOLLOWS:

"15. PLANS AND SPECIFICATIONS

(A) TO BE ATTACHED TO THE BID: FOUR COPIES OF FLOOR PLAN/S) TO A SCALE OF 1/8 INCH TO THE FOOT SHOWING SPACE OFFERED AS IT IS THEN LAID OUT AND SHOWING CHANGES PROPOSED AT BIDDERS EXPENSE TO COMPLY WITH THIS INVITATION.'

FROM THE SPECIFIC NATURE AND THE LANGUAGE OF THE FOREGOING PROVISIONS OF THE INVITATION WE CONCLUDE THAT THE DATA REQUIRED TO BE SUBMITTED WITH THE BIDS MUST BE REGARDED AS AN INTEGRAL PART OF THE BIDS.

THE BID FORM AT ITEM 2 CALLS FOR A STATEMENT OF THE TYPE AND AMOUNT OF "NET USABLE SPACE" AND IDENTIFICATION OF THE SPACE OFFERED. THE TERM "NET USABLE SPACE" IS DEFINED IN THE SPECIFICATIONS TO EXCLUDE CORRIDORS, REST ROOMS, LOBBIES, SERVICE AREAS, AND, TO A CERTAIN EXTENT, FOOD SERVICE SPACE. BLOCKS ARE AVAILABLE FOR THE BIDDER TO INDICATE THE NUMBER OF SQUARE FEET OFFERED OF (A) OFFICE SPACE, (B) STORAGE SPACE, AND (C) OTHER SPACE WHICH THE BIDDER IS DIRECTED TO SPECIFY. THE SPECIFICATIONS SPELL OUT MINIMUM STANDARDS TO BE MET WITH RESPECT TO CERTAIN MAJOR CHARACTERISTICS OF THE BUILDING, SUCH AS REST ROOMS AND FOOD SERVICE AREAS.

WE ARE INFORMED THAT IN DETERMINING THE SPACE BEING OFFERED BY EACH BIDDER THE CONTRACTING AGENCY MEASURED THE INTERIOR DIMENSIONS OF THE BUILDING DIAGRAMS REQUIRED TO BE FURNISHED WITH THE BIDS PURSUANT TO THE PROVISIONS PREVIOUSLY QUOTED. IF SUCH MEASUREMENTS RESULTED IN QUANTITIES EITHER MORE OR LESS THAN THOSE STATED IN THE APPROPRIATE BLOCKS OF THE BID, THE FORMER WERE ADOPTED FOR BID EVALUATION PURPOSES.

IN OUR JUDGMENT, IF CONFLICTS OR INCONSISTENCIES IN THE BID ARE TO BE DECIDED BY ACCEPTING ONE PART OF THE BID DATA IN PREFERENCE TO ANOTHER, THE INVITATION SHOULD SO PROVIDE. WE ARE UNABLE TO FIND SUCH A PROVISION IN THIS CASE. WHERE SUCH PROVISION IS OMITTED, IT APPEARS TO US THAT, AT THE VERY LEAST, A CONSISTENT POLICY SHOULD BE FOLLOWED. HOWEVER, FROM THE INFORMATION WE HAVE BEEN ABLE TO OBTAIN, THE DIAGRAMS WERE IGNORED WHERE THEY INDICATED FAILURE TO COMPLY WITH CERTAIN MINIMUM REQUIREMENTS OF THE INVITATION. IT WAS ASSUMED THAT THE CONTRACTOR, REGARDLESS OF WHAT HE SHOWED IN HIS DIAGRAMS, OTHER THAN TOTAL QUANTITY OF NET USABLE SPACE, WOULD BE REQUIRED TO MEET THE MINIMUM STANDARDS OF THE SPECIFICATION, AND THAT THE CONTRACTING AGENCY COULD REQUIRE CHANGES PRIOR TO ACTUAL CONSTRUCTION FROM WHAT WAS SHOWN IN THE DRAWINGS, AT LEAST TO THE EXTENT NECESSARY TO MEET THE SPECIFICATION STANDARDS.

AS AN EXAMPLE, ONE OF THE SUCCESSFUL BIDS, THAT FOR THE PHILLIPS BUILDING, WAS ACCOMPANIED BY FLOOR PLANS WHICH FAILED TO INDICATE THAT ANY PROVISION HAD BEEN MADE FOR FOOD SERVICE SPACE REQUIRED TO BE FURNISHED FOR THE AMOUNT OF NET USABLE SPACE AS EVALUATED BUT NOT INCLUDED IN THE NET USABLE AREA UNDER PARAGRAPH A3 AT SCHEDULE B AS AMENDED BY PARAGRAPH K OF ADDENDUM NO. 1. CONFORMITY WITH THE SPECIFICATION REQUIREMENT COULD BE OBTAINED, IT WOULD APPEAR, ONLY AT THE EXPENSE OF THE NET USABLE AREA. YET THE QUANTITIES OF SPACE USED FOR BID EVALUATION WERE NOT ADJUSTED ACCORDINGLY.

ITEM 6 OF SCHEDULE B, AS AMENDED, REQUIRES A "MINIMUM CLEAR CEILING HEIGHT OF APPROXIMATELY 8 FEET 6 INCHES.' NARRATIVE DATA SUBMITTED WITH THE PHILLIPS BID OFFERS CEILINGS WITH SUCH CLEARANCE ONLY AT AN INCREASE IN THE ANNUAL RENTAL OF $0.03 PER SQUARE FOOT OF NET USABLE SPACE. NEVERTHELESS, THE BID WAS EVALUATED WITHOUT SUCH INCREASE. IN ADDITION, THE NARRATIVE DATA DESCRIBES THE EXISTING PORTION OF THE STRUCTURE OFFERED IN THE ACCEPTED ALTERNATE AS HAVING A CEILING CLEARANCE HEIGHT OF 8 FEET 1 INCH. WE HAVE BEEN INFORMALLY ADVISED THAT IT WOULD BE IMPRACTICAL TO ATTEMPT ANY SIGNIFICANT INCREASE IN THE CLEAR CEILING HEIGHT OF THE EXISTING STRUCTURE. WE HAVE BEEN ASSURED, HOWEVER, THAT THE EXISTING CEILING HEIGHT WILL NOT HAVE ANY ADVERSE EFFECT ON THE ANTICIPATED UTILIZATION OF THE BUILDING.

WE HAVE NO REASON TO QUESTION THAT CONCLUSION. WE DO, HOWEVER, QUESTION WHETHER AN 8-FOOT 1-INCH CEILING MAY BE REGARDED AS CONFORMING TO A SPECIFICATION REQUIREMENT STATED AS A MINIMUM OF APPROXIMATELY 8 FEET 6 INCHES. IT APPEARS TO BE CONCEDED THAT THE LESSER HEIGHT WOULD NOT BE REGARDED AS IN CONFORMITY WITH THE SPECIFICATIONS IF ONLY NEW CONSTRUCTION IS INVOLVED. IT IS URGED THAT SINCE PART OF THE STRUCTURE IS IN EXISTENCE, AND SINCE THE CONTRACTING AGENCY ANTICIPATED OFFERS OF EXISTING SPACE, THE DEVIATION SHOULD NOT BE REGARDED AS MATERIAL. ON THE OTHER HAND, PARAGRAPH 2 OF THE INSTRUCTIONS TO BIDDERS STATES IN PART:

"* * * SPACE OFFERED IN EXISTING BUILDING/S) WILL BE CONSIDERED. EXISTING BUILDING/S) MUST BE ALTERED TO CONFORM WITH THE REQUIREMENTS SET FORTH IN THIS INVITATION. * * *"

WE THINK IT NOT UNREASONABLE TO INFER THAT, WHILE EXISTING SPACE WILL BE ACCEPTED IF IT IS ALTERED TO CONFORM, OFFERS FOR NEW SPACE ARE AT LEAST AS WELCOME.

THUS EXISTING SPACE IS COMPETING AGAINST SPACE TO BE CONSTRUCTED. THE DIFFERENCE IN PRICES IN THE PHILLIPS BID IS IN ITSELF, WE THINK, SUFFICIENT EVIDENCE TO WARRANT A CONCLUSION THAT NEW SPACE OFFERED WITH A CEILING CLEARANCE OF 8 FEET 1 INCH SHOULD NOT BE CONSIDERED RESPONSIVE TO THE SPECIFICATION REQUIREMENTS. THEREFORE, THOSE OFFERING NEW SPACE ARE PLACED IN THE UNFORTUNATE POSITION OF HAVING TO CONFORM TO A REQUIREMENT WHICH FOR EXISTING SPACE MAY BE WAIVED. IF BIDDERS OFFERING NEW SPACE HAD CONTEMPLATED CEILINGS OF 8 FEET 1 INCH, WE THINK IT REASONABLE TO ASSUME THAT THEIR BIDS WOULD HAVE BEEN LOWER. UNDER THE CIRCUMSTANCES, IF IN FACT AN 8-FOOT 1-INCH CEILING CAN SATISFY THE PURPOSES OF THE PROCUREMENT, WE THINK THAT THE UNIVERSALLY ACCEPTED PRINCIPLE, THAT THE SPECIFICATIONS SHOULD SET OUT CLEARLY THE REASONABLE REQUIREMENTS OF THE USING AGENCY, HAS BEEN VIOLATED. SEE 32 COMP. GEN. 384, 387.

IT WILL BE NOTED FROM THE ATTACHMENT THAT THE PHILLIPS BUILDING BID WAS EVALUATED AT APPROXIMATELY 4,000 MORE SQUARE FEET OF NET USABLE SPACE THAN WAS INDICATED ON THE BID FORM ITSELF BY THE BIDDER.

THIS APPEARS TO HAVE BEEN DUE TO THE CONSIDERATION IN THE BID EVALUATION OF SPACE INCLUDED IN THE BID UNDER THE "OTHER" CATEGORY AND SPECIFIED AS GARAGE SPACE. THE SCALED DIAGRAMS FOR THE BUILDING INDICATE THAT A CERTAIN PORTION OF THE EXISTING BASEMENT SPACE WAS SET ASIDE FOR A GARAGE, WHILE AN ADJOINING PORTION TO BE CONSTRUCTED WAS OFFERED AS EITHER A GARAGE WITH A CAPACITY FOR 20 CARS OR AS AN ALTERNATE OFFICE AREA. NARRATIVE DATA SUBMITTED WITH THE BID INDICATED BOTH AREAS WOULD BE AVAILABLE TO THE GOVERNMENT AS GARAGE SPACE FOR A TOTAL OF 37 CARS. NEVERTHELESS, IN EVALUATING THE BID THE 20-CAR CAPACITY AREA WAS CONSIDERED FOR USE AS STORAGE SPACE. UNDER PARAGRAPH 14 (J) OF SCHEDULE B OF THE SPECIFICATIONS, OFF-STREET PARKING IS NOT TO BE INCLUDED AS A PART OF THE RENTAL PRICE QUOTED. RATHER, THE BIDDER IS ENJOINED TO STATE THE MONTHLY RATE FOR PARKING SPACE IN HIS BID SEPARATELY. THE DATA SUBMITTED WITH THE BID REFERRED TO ABOVE STATES AS FOLLOWS:

"AUTO PARKING WILL BE AVAILABLE TO THE GOVERNMENT IN THE GARAGE BUILT IN THE LOWER LEVEL OF THE BUILDING, FOR THE 37 CARS UNDER BID A (THE BID ACCEPTED) * * *. THE RENTAL FOR PARKING SPACE SHALL BE $20 PER PARKING SPACE PER MONTH IN ADDITION TO THE RENTAL QUOTED FOR OFFICE SPACE.'

NOTWITHSTANDING THE FOREGOING, THE BID WAS EVALUATED TO INCLUDE THE NEW PARKING SPACE AS STORAGE WITHOUT ANY INCREASE IN THE BASE AMOUNT OF THE BID. WE CAN FIND NO REASONABLE JUSTIFICATION FOR CONCLUDING THAT GARAGE SPACE OFFERED AT A TOTAL RENTAL OF $400 PER MONTH WOULD BE CONVERTED BY THE LESSOR TO STORAGE SPACE AND FURNISHED WITHOUT CHARGE. IN THIS CONNECTION, IT SHOULD BE NOTED WITH RESPECT TO THE AREA OFFERED FOR GARAGE SPACE, THAT STORAGE SPACE IS REQUIRED UNDER THE TERMS OF THE SPECIFICATIONS TO CONFORM TO CERTAIN STANDARDS NOT NECESSARILY APPLICABLE TO GARAGE SPACE. FOR EXAMPLE, STORAGE SPACE IS REQUIRED TO MEET LIGHTING, PARTITION, AND DECORATING REQUIREMENTS.

WE HAVE NOT ATTEMPTED TO ANALYZE ALL THE DISCREPANCIES BETWEEN THE BIDS AS SUBMITTED AND AS EVALUATED. THE SET OF DIAGRAMS DISCUSSED ABOVE MAY OR MAY NOT BE REPRESENTATIVE OF ALL THOSE SUBMITTED WITH SUCCESSFUL BIDS. HOWEVER, THE CHART APPENDED AS ATTACHMENT A INDICATES CLEARLY THAT THE SUCCESSFUL BIDS AS EVALUATED AND AS SUBMITTED WERE THE SAME IN ONLY ONE CASE.

THE TREATMENT OF THE SPECIFICATION AND PRICING DATA DESCRIBED ABOVE RAISES A SERIOUS QUESTION AS TO WHAT SHOULD BE REGARDED AS COMPOSING THE BID. IF THE DIAGRAMS AND DESCRIPTIVE DATA CONSTITUTE THE PORTION OF THE BID WHICH SHOULD PREVAIL IN THE EVENT OF CONFLICT, THOSE BIDS WHICH INCLUDE DIAGRAMS AND DATA NOT CONFORMING TO THE SPECIFICATIONS SHOULD BE REJECTED. IF THE INFORMATION INSERTED BY THE BIDDERS IN THE APPLICABLE SPACES OF THE BID FORM SHOULD BE CONSIDERED PARAMOUNT, THEN THE SPACE QUANTITIES SHOWN IN THE BID FORM SHOULD DETERMINE THE AMOUNT REQUIRED TO BE FURNISHED BY THE BIDDER AND EMPLOYED AS THE BASIS FOR EVALUATION. CF. 36 COMP. GEN. 376.

UNDER GENERAL CONTRACT LAW A BID IS AN OFFER. AN OFFER TO BE LEGALLY BINDING MUST BE SUFFICIENTLY DEFINITE TO ENABLE A COURT OF LAW TO GIVE IT AN EXACT MEANING. 1 WILLISTON ON CONTRACTS, REVISED EDITION, SECTION 37. SEE ALSO RESTATEMENT CONTRACTS, SECTION 32, WHICH STATES:

"AN OFFER MUST BE SO DEFINITE IN ITS TERMS, OR REQUIRE SUCH DEFINITE TERMS IN THE ACCEPTANCE, THAT THE PROMISES AND PERFORMANCES TO BE RENDERED BY EACH PARTY ARE REASONABLY CERTAIN.'

THE COMPETITIVE BIDDING SYSTEM CONTEMPLATES THAT BIDS WILL BE SUBMITTED IN SUCH FORM THAT ACCEPTANCE WILL EFFECT A BINDING CONTRACT. PARAGRAPH 11 OF THE INSTRUCTIONS TO BIDDERS INCLUDED IN THE INVITATION CONTEMPLATES SUCH A RESULT. IN THIS CASE, HOWEVER, IT CANNOT BE CONSIDERED THAT ANY DEFINITE OFFER HAS BEEN RECEIVED, AT LEAST IN THE VAST MAJORITY OF CASES, UNDER THE INTERPRETATION OF THE BIDS APPLIED BY THE CONTRACTING AGENCY. RATHER, AS CONSTRUED BY THE PUBLIC BUILDINGS SERVICE, BIDDERS HAVE SUBMITTED VARYING OFFERS IN THE BID FORM, THE SPECIFICATIONS, THE DIAGRAMS, AND THE DESCRIPTIVE DATA, AND THE CONTRACTING OFFICER HAS ARROGATED TO HIMSELF THE OPTION TO SELECT PORTIONS OF THOSE OFFERS TO FORM A FINAL OFFER WHICH HE IS WILLING TO ACCEPT. UNDER THE CIRCUMSTANCES WE BELIEVE THAT A SERIOUS QUESTION MAY BE RAISED AS TO WHETHER THE ACCEPTANCES ESTABLISHED BINDING CONTRACTS OR WHETHER IN FACT THOSE ACCEPTANCES CONSTITUTED ONLY OFFERS OR COUNTEROFFERS IN THE COURSE OF NEGOTIATIONS.

AS NOTED PREVIOUSLY, BIDS WERE SOLICITED UNDER THE INVITATION FOR"GENERAL OFFICE AND RELATED SPACE.' THE BID FORM CLEARLY INDICATED THAT STORAGE SPACE WAS TO BE INCLUDED BY PROVIDING A BLANK TO BE FILLED IN WITH THE QUANTITY OF SUCH SPACE OFFERED. IN ADDITION, OTHER PROVISIONS OF THE SPECIFICATIONS MADE SPECIFIC REFERENCE TO STORAGE SPACE. FROM THE FOREGOING WE CONCLUDE THAT IT WAS INTENDED TO ACQUIRE STORAGE SPACE IN ADDITION TO GENERAL OFFICE SPACE AND THAT IN THE ABSENCE OF A PROVISION TO THE CONTRARY THE TWO TYPES OF SPACE WOULD BE EVALUATED TOGETHER. ON THE OTHER HAND, SCHEDULE A OF THE SPECIFICATIONS UNDER THE HEADING "AWARD FACTORS" PROVIDES AT ITEM A THAT ONE OF THE FACTORS TO BE CONSIDERED IN THE EVALUATION OF BIDS IS--

"A. THE LOWEST RENTAL RATE PER SQUARE FOOT FOR THE MAXIMUM AMOUNT OF NET USABLE OFFICE SPACE OFFERED IN A SINGLE BUILDING.'

THUS SOME QUESTION IS RAISED AS TO JUST HOW IT WAS INTENDED THAT STORAGE SPACE SHOULD BE EVALUATED. THIS IS SIGNIFICANT SINCE THE INFORMATION MADE AVAILABLE TO US TENDS TO INDICATE THAT THE ANNUAL RENTAL PER SQUARE FOOT OF STORAGE SPACE IS APPROXIMATELY 1/4 TO 1/2 OF THAT FOR OFFICE SPACE.

WE HAVE BEEN ADVISED INFORMALLY OF THE CONTRACTING AGENCY'S POSITION THAT THE TERM "FIRST CLASS OFFICE AND RELATED SPACE" WHICH APPEARS AT ITEM 7 OF SCHEDULE A, AS AMENDED BY ADDENDUM NO. 1, HAS A CLEAR MEANING IN THE TRADE AND IMPLIES A CERTAIN PROPORTION OF STORAGE SPACE. WE QUESTION THE ACCURACY OF THIS CONTENTION IN VIEW OF THE WIDE RANGE IN PROPORTION OF STORAGE SPACE OFFERED BY THE SUCCESSFUL BIDDERS AS NOTED IN THE ATTACHED CHART. IN ANY CASE, NO LIMITS WERE PLACED ON THE AMOUNT OF STORAGE SPACE WHICH COULD BE PROVIDED IN PROPORTION TO OFFICE SPACE. WE HAVE BEEN ADVISED THAT NO BIDDER WOULD HAVE BEEN PERMITTED TO OFFER TOO LARGE A PROPORTION OF STORAGE SPACE TO OFFICE SPACE BUT, IN PRACTICE, IN EACH CASE THE AMOUNT OF STORAGE SPACE OFFERED WAS FOUND NOT TO BE EXCESSIVE AND THE LOWER VALUE STORAGE SPACE WAS SIMPLY ADDED TO THE OFFICE SPACE AND THE TOTAL DIVIDED INTO THE ANNUAL RENTAL PRICE TO DETERMINE THE PRICE PER SQUARE FOOT WHICH WAS EMPLOYED AS THE BASIS FOR EVALUATION. THEREFORE, THOSE BIDDERS OFFERING A GREATER PROPORTION OF THE LOWER VALUE STORAGE SPACE OBTAINED AN ADVANTAGE IN EVALUATION OVER THOSE OFFERING ALL, OR ALMOST ALL, OFFICE SPACE. STORAGE SPACE COULD BETTER HAVE BEEN HANDLED IN A MANNER SIMILAR TO FOOD SERVICE OR REST ROOM FACILITIES BY REQUIRING AN AMOUNT VARYING WITH THE NUMBER OF SQUARE FEET OF OFFICE SPACE TO BE FURNISHED WITHOUT INCLUDING THE QUANTITY OF STORAGE SPACE IN THE DEFINITION OF NET USABLE SPACE. LACKING SUCH AN APPROACH THE INVITATION SHOULD EITHER HAVE ESTABLISHED A RATIO BETWEEN THE TWO TYPES OF SPACE OR PROVIDED FOR SEPARATE EVALUATION FOR EACH. IN OUR JUDGMENT THE BASIS FOR EVALUATION ACTUALLY EMPLOYED WAS INAPPROPRIATE. BUT EVEN LESS APPROPRIATE WAS THE VAGUE AND SOMEWHAT MISLEADING MANNER, AS DESCRIBED ABOVE, IN WHICH THE BASIS FOR EVALUATION WAS SET OUT.

THE PROTESTING BIDDER SET ASIDE PARKING SPACES IN THE BASEMENT OF THE BUILDING WHICH HE PROPOSED TO CONSTRUCT FROM WHICH HE COULD EXPECT TO DERIVE A RENTAL OF NO MORE THAN $6,500 PER YEAR. THE SAME SPACE CONVERTED TO STORAGE WOULD, EVEN AT AN ANNUAL RENTAL OF $1 PER SQUARE FOOT, PROVIDE A GROSS RETURN ALMOST THREE TIMES AS GREAT. IN ADDITION, THAT AREA OFFERED AS STORAGE SPACE WOULD HAVE SUFFICIENTLY REDUCED HIS RATE PER SQUARE FOOT UNDER THE EVALUATION FORMULA USED TO VIRTUALLY INSURE THE SUCCESS OF HIS BID. HIS FAILURE TO TAKE SUCH ACTION SEEMS TO US TO INDICATE THAT THE BASIS FOR EVALUATION EMPLOYED WAS NOT APPARENT TO AN EXPERIENCED BIDDER FROM THE LANGUAGE OF THE INVITATION.

IT IS WELL RECOGNIZED THAT COMPETITIVE BIDDING AS CONTEMPLATED UNDER THE APPLICABLE STATUTES CANNOT BE ACHIEVED UNLESS BIDDERS ARE APPRISED OF THE BASIS UPON WHICH THEIR BIDS WILL BE EVALUATED AND UNLESS THE BIDS ARE IN FACT EVALUATED IN ACCORDANCE WITH SUCH STATED BASIS. SEE FOR EXAMPLE DETROIT FREE PRESS V. BOARD OF STATE AUDITORS. 10 N.W. 171 (MICH. 1881), IN WHICH THE COURT IN CONSIDERING THE VALIDITY OF A PROCUREMENT REQUIRED TO BE AWARDED PURSUANT TO COMPETITIVE BIDDING STATED AT PAGE 174:

"BUT IN ORDER THAT THERE MAY BE FULL AND FREE COMPETITION IT IS ABSOLUTELY ESSENTIAL THAT BIDDERS SHALL HAVE THE MEANS OF FORMING SOME ESTIMATE OF WHAT WILL BE REQUIRED OF THEM AND SHALL BE APPRISED OF THE BASIS ON WHICH THE CALCULATIONS ARE TO BE MADE WHICH ARE TO DECIDE BETWEEN THEM * * *.'

WE HAVE ADOPTED THE SAME POSITION IN OUR OWN DECISIONS. SEE FOR EXAMPLE 36 COMP. GEN. 380, 384, AS FOLLOWS:

"THE PURPOSE OF STATUTES REQUIRING THE AWARD OF CONTRACTS TO THE LOWEST RESPONSIBLE BIDDER AFTER ADVERTISING IS TO GIVE ALL PERSONS EQUAL RIGHT TO COMPETE FOR GOVERNMENT CONTRACTS, TO PREVENT UNJUST FAVORITISM, COLLUSION, OR FRAUD IN AWARDING GOVERNMENT CONTRACTS, AND TO SECURE FOR THE GOVERNMENT THE BENEFITS WHICH FLOW FROM FREE AND UNRESTRICTED COMPETITION. SEE UNITED STATES V. BROOKRIDGE FARM, 111 F.2D 461. PERMIT BIDDERS TO COMPETE ON EQUAL TERMS, THE INVITATION MUST BE SUFFICIENTLY DEFINITE TO PERMIT THE PREPARATION AND EVALUATION OF BIDS ON A COMMON BASIS. BIDDERS CANNOT COMPETE ON AN EQUAL BASIS AS REQUIRED BY LAW UNLESS THEY KNOW IN ADVANCE THE BASIS ON WHICH THEIR BIDS WILL BE EVALUATED. B-128405, SEPTEMBER 17, 1956. * * *"

FOR OTHER LEGAL AUTHORITIES TO THE SAME EFFECT SEE 43 AM.JUR., PUBLIC WORKS AND CONTRACTS, SECTIONS 23, 26 AND 36; 63 C.J.S., MUNICIPAL CORPORATIONS, SECTION 998; 10 MCQUILLIN, MUNICIPAL CORPORATIONS, 3RD EDITION, SECTION 29.52. THE FOREGOING, WE BELIEVE, REQUIRES NO FURTHER COMMENT EXCEPT TO NOTE THAT, IN OUR OPINION, THE CITED PRINCIPLE WAS NOT FOLLOWED IN THE INSTANT PROCUREMENT.

AS NOTED EARLIER THE PROTESTING BIDDER RAISED TWO ADDITIONAL POINTS. THE FIRST OF THESE WAS THAT ONE OF THE BIDDERS FAILED TO COMPLY WITH CERTAIN OF THE DATA FURNISHING REQUIREMENTS EXPRESSED IN PARAGRAPH 11 OF SCHEDULE A, AS AMENDED, WHICH HAS ALREADY BEEN NOTED. WE HAVE BEEN ADVISED THAT THE BIDDERS IN QUESTION DID IN FACT PROVIDE DATA IN CONFORMITY WITH THE PROVISION AS AMENDED, ALTHOUGH SOME OF THAT INFORMATION WAS INCLUDED ON THE DRAWINGS RATHER THAN IN THE BID FORM. ON THE BASIS THAT THE DATA WAS IN FACT SUPPLIED AS REQUIRED, WE CONCLUDE THIS DOES NOT CONSTITUTE A VALID OBJECTION.

THE FINAL POINT IS THAT ONE OF THE BIDDERS WHO WAS AWARDED A 10-YEAR LEASE DID NOT BID ON THE 5-YEAR TERM, ALTHOUGH THIS IS CLEARLY REQUIRED BY THE TERMS OF THE INVITATION. WITHOUT GOING INTO A DISCUSSION OF THE MATTER, IT IS SUFFICIENT TO NOTE OUR POSITION THAT SUCH A FAILURE TO BID ON AN ALTERNATE, EVEN THOUGH REQUIRED UNDER THE CLEAR MEANING OF THE INVITATION, DOES NOT RENDER A BID NONRESPONSIVE WITH RESPECT TO AN ITEM ACTUALLY BID ON SO LONG AS IT IS ADMINISTRATIVELY DETERMINED THAT THE GOVERNMENT'S BEST INTEREST WOULD BE SERVED BY MAKING AN AWARD ON THE ITEM BID UPON RATHER THAN THE ALTERNATE OMITTED. SEE B-147038, SEPTEMBER 7, 1961.

THE DISCUSSION ABOVE, IN OUR JUDGMENT, INDICATES THE NEED FOR A TIGHTENING-UP OF PROCEDURES EMPLOYED BY THE PROCURING AGENCY IN THE PREPARATION OF INVITATIONS AND THE EVALUATION OF BIDS. AN ANALYSIS SHOWS, HOWEVER, THAT PROPER EVALUATION OF THE BIDS, EXCLUDING CONSIDERATION OF THE BID BOND QUESTION, WOULD NOT HAVE AFFECTED THE RENTALS PAID NOR WOULD IT HAVE CHANGED THE LIST OF SUCCESSFUL BIDDERS EXCEPT FOR THEIR ORDER. THE PHILLIPS BUILDING LEASE WOULD NOT HAVE BEEN SUFFICIENTLY LOW TO QUALIFY FOR AN AWARD IF THE AWARD HAD BEEN MADE ON THE BASIS OF COMPLETE BUILDING SERVICING BY THE LESSOR. HOWEVER, THE PLANNED OCCUPANCY OF THE BUILDING IS SUCH THAT AWARD MUST BE MADE EXCLUDING BUILDING OPERATING SERVICES. SINCE EVALUATION MUST BE MADE ON THE SAME BASIS AS AWARD, THE PHILLIPS BID IS LOW ENOUGH TO QUALIFY FOR AWARD AS PROPERLY EVALUATED. SEE B-143404, SEPTEMBER 15, 1960. WITH RESPECT TO THE BIDS ACCOMPANIED BY THE QUESTIONABLE BID BONDS, THE DEGREE OF COMPLETION OF THE STRUCTURES IS SUCH AS, UNDER THE CIRCUMSTANCES, TO PRECLUDE ANY CONSIDERATION OF CANCELLATION AT THIS TIME.

WE ARE TAKING THE LIBERTY OF FURNISHING A COPY OF THIS LETTER TO THE CHAIRMAN OF THE SENATE COMMITTEE ON GOVERNMENT OPERATIONS, IN VIEW OF THE COMMITTEE'S EXPRESSED INTEREST IN THE MATTER. * * * * * * * * * * * * * * (CHART OMITTED) * * * * * * * * * * * * * * * ..END :