B-149920, JAN. 10, 1963

B-149920: Jan 10, 1963

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WIENER AND ROSS: REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 17. SINCE IT WAS BELIEVED THAT A CONTRACT OR ORDER COVERING THE PERIOD AUGUST 1 TO OCTOBER 31. WOULD SUFFICE ALL BIDS WERE REJECTED AND THE REDUCED REQUIREMENTS WERE OBTAINED UNDER AUTHORIZED SMALL PURCHASE POLICIES AND PROCEDURES. IT IS REPORTED BY HEW THAT THE NATIONAL INSTITUTES OF HEALTH ERRED IN NOT NOTIFYING BIDDERS OF THE REJECTION OF THEIR BIDS. THAT THE LOW BID IN THIS CASE COULD NOT PROPERLY HAVE BEEN REJECTED AS NOT RESPONSIVE TO THE INVITATION. NOR DO WE AGREE THAT IT WAS IMPROPER TO REJECT ALL BIDS WHEN ADMINISTRATIVELY DETERMINED THAT IT WAS UNNECESSARY TO OBLIGATE THE GOVERNMENT FOR THE ENTIRE PERIOD AS SPECIFIED IN THE INVITATION.

B-149920, JAN. 10, 1963

TO WACHTEL, WIENER AND ROSS:

REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 17, 1962, AND PRIOR CORRESPONDENCE CONCERNING THE PROTEST MADE ON BEHALF OF CAPITOL TRANSCRIPTIONS, INC., WASHINGTON, D.C., AGAINST THE FAILURE OF THE NATIONAL INSTITUTES OF HEALTH, PUBLIC HEALTH SERVICE, DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE, TO MAKE AN AWARD OF A CONTRACT FOR STENOGRAPHIC REPORTING SERVICE UNDER INVITATION FOR BIDS NO. CC-A-11 63, ISSUED ON MAY 14, 1962.

THE RECORD SHOWS THAT AFTER OPENING OF BIDS THE NATIONAL INSTITUTES OF HEALTH NOT ONLY DETERMINED THAT CAPITOL TRANSCRIPTIONS HAD SUBMITTED A NONRESPONSIVE BID BUT THAT THE REQUIREMENTS FOR STENOGRAPHIC SERVICE WOULD BE CONSIDERABLY LESS THAN ANTICIPATED AT THE TIME OF ISSUING THE INVITATION AND, THEREFORE, NO CONTRACT NEED BE AWARDED TO COVER THE ENTIRE PERIOD AS STATED IN THE INVITATION (JULY 1, 1962, TO JUNE 30, 1963). SINCE IT WAS BELIEVED THAT A CONTRACT OR ORDER COVERING THE PERIOD AUGUST 1 TO OCTOBER 31, 1962, WOULD SUFFICE ALL BIDS WERE REJECTED AND THE REDUCED REQUIREMENTS WERE OBTAINED UNDER AUTHORIZED SMALL PURCHASE POLICIES AND PROCEDURES. IT IS REPORTED BY HEW THAT THE NATIONAL INSTITUTES OF HEALTH ERRED IN NOT NOTIFYING BIDDERS OF THE REJECTION OF THEIR BIDS.

YOU CITE 38 COMP. GEN. 190 AS INDICATING THAT THERE MUST BE A CLEAR BASIS IN AN INVITATION FOR BIDS TO JUSTIFY THE REJECTION OF THE LOW BID. WE DO NOT AGREE, HOWEVER, THAT THE LOW BID IN THIS CASE COULD NOT PROPERLY HAVE BEEN REJECTED AS NOT RESPONSIVE TO THE INVITATION. NOR DO WE AGREE THAT IT WAS IMPROPER TO REJECT ALL BIDS WHEN ADMINISTRATIVELY DETERMINED THAT IT WAS UNNECESSARY TO OBLIGATE THE GOVERNMENT FOR THE ENTIRE PERIOD AS SPECIFIED IN THE INVITATION. AS PROVIDED IN SECTION 253 (B) OF TITLE 41, UNITED STATES CODE,"ALL BIDS MAY BE REJECTED WHEN THE AGENCY HEAD DETERMINES THAT IT IS IN THE PUBLIC INTEREST TO DO SO.' IN ANY EVENT, THE ONLY BIDDER WHO WOULD HAVE ANY POSSIBLE COMPLAINT AGAINST REJECTION OF ALL BIDS WOULD BE ACE FEDERAL REPORTERS, INC., THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER, AND THE RECORD SHOWS THAT THIS FIRM ACCEPTED AN ORDER AT ITS BID PRICE COVERING SERVICE TO BE PERFORMED ONLY DURING THE PERIOD AUGUST 1 TO OCTOBER 31, 1962.

YOU WERE PERMITTED TO EXAMINE THE DEPARTMENTAL REPORT AND YOU STILL MAINTAIN THAT YOUR CLIENT'S BID WAS RESPONSIVE TO THE INVITATION. YOU SUGGEST THAT THE NATIONAL INSTITUTES OF HEALTH SOUGHT TO CIRCUMVENT REGULATIONS BECAUSE IT DID NOT NOTIFY ALL BIDDERS THAT THEIR BIDS WERE REJECTED. YOU ALSO EXPRESS THE OPINION THAT THE CONTRACTING AGENCY APPARENTLY DESIRED THAT A CERTAIN COMPANY RECEIVE THE AWARD OF CONTRACT FOR THE SERVICES CALLED FOR BY THE INVITATION FOR BIDS.

THE FAILURE OF THE NATIONAL INSTITUTES OF HEALTH TO NOTIFY ALL BIDDERS THAT THEIR BIDS WERE REJECTED IS AN ADMITTED OVERSIGHT. HOWEVER, THE FACTS OF THE CASE--- WHICH INDICATE CLEARLY THAT THE LOW BID WAS NOT RESPONSIVE AND THAT THE SECOND LOWEST BIDDER MADE NO COMPLAINT BUT ACCEPTED AN ORDER COVERING THE REDUCED REQUIREMENTS--- DO NOT JUSTIFY A CONCLUSION THAT THE CONTRACTING AGENCY SOUGHT TO CIRCUMVENT REGULATIONS GOVERNING THE MAKING OF CONTRACT AWARDS OR THAT IT HAD ANY INTENT TO RESTRICT AN AWARD TO A FAVORED CONCERN.

IT IS ARGUED IN YOUR LETTER THAT YOUR CLIENT SPECIFIED THE RECORDING DEVICE METHOD OF REPORTING AND THAT THE WORDS INSERTED IN THE APPROPRIATE BLANK SPACE OF THE BID CANNOT BE CONSTRUED AS A QUALIFICATION BY THE BIDDER WHICH PLACED HIM IN THE POSITION OF OFFERING TO PROVIDE LESS THAN THAT WHICH WAS CALLED FOR BY THE INVITATION.

WE NOTE THAT YOU DO NOT COMMENT ON THE BASIC QUESTIONABLE FEATURE OF YOUR CLIENT'S BID OR THE CONCLUSIONS REACHED BY THE DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE WITH RESPECT THERETO.

IMMEDIATELY AFTER THE DESIGNATION OF RECORDING DEVICE AS THE REPORTING METHOD, YOUR CLIENT'S BID CONTAINS THE FOLLOWING LANGUAGE: "BASED ON A SYSTEM DISCUSSED WITH DR. BROWN WHEN WE WERE THE REPORTERS FOR THE CLINICAL STAFF MEETINGS SEVERAL YEARS AGO.'

THIS LANGUAGE WAS ORIGINALLY CONSIDERED IN ITSELF AS HAVING RENDERED THE BID NOT RESPONSIVE TO THE INVITATION, INASMUCH AS THE DETAILS OF THE PROPOSED SYSTEM WERE NOT FURNISHED. HOWEVER, INVESTIGATION DISCLOSED THAT THE SYSTEM USED SEVERAL YEARS AGO INVOLVED THE USE OF EQUIPMENT OWNED BY THE GOVERNMENT AND THE CHESAPEAKE AND POTOMAC TELEPHONE COMPANY. THE INVITATION DID NOT PROVIDE THAT THE GOVERNMENT WOULD FURNISH ANY SUCH EQUIPMENT AND THE BID WAS THEREFORE CONSIDERED AS NOT RESPONSIVE FROM THAT STANDPOINT. FURTHERMORE, THE QUESTION ALSO NATURALLY AROSE IN CONNECTION WITH THE INVESTIGATION OF THE SYSTEM USED SEVERAL YEARS AGO AS TO WHETHER YOUR CLIENT INTENDED TO COMPLY WITH THE REQUIREMENT OF THE INVITATION THAT A REPRESENTATIVE OF THE CONTRACTOR BE PRESENT AT THE TIMES AND PLACES OF DESIGNATED CONFERENCES.

WE BELIEVE IN THE PARTICULAR CIRCUMSTANCES THAT THE DETERMINATION THAT YOUR CLIENT HAD FAILED TO SUBMIT A FULLY RESPONSIVE AND ACCEPTABLE BID WAS CORRECT.

ACCORDINGLY, THE PROTEST MADE TO OUR OFFICE IN THE MATTER MUST BE DENIED.