B-150656, MAR. 20, 1963

B-150656: Mar 20, 1963

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TO THE YORK CORPORATION: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM DATED JANUARY 17 AND LETTER OF JANUARY 18. WAS HANDLED BY THE NAVY PURCHASING OFFICE. AN EXAMINATION OF THE RECORD NOW BEFORE THIS OFFICE INDICATES THAT INVITATION FOR BIDS IFB600-398-63 WAS ISSUED BY THE NAVY PURCHASING OFFICE ON DECEMBER 10. THE SUPPLIES ARE COVERED BY A NAVY QUALIFIED PRODUCTS LIST. FOUR BIDS WERE SOLICITED. FOUR BIDS WERE RECEIVED. THE TOTALS OF WHICH WERE AS FOLLOWS: TABLE WORTHINGTON CORPORATION $252. 400.00 IT IS REPORTED THAT AT THE TIME THIS PROCUREMENT WAS ADVERTISED THE BUREAU OF SHIPS INFORMED THE NAVY PURCHASING OFFICE THAT THE DESTINATIONS HAD NOT BEEN DETERMINED AND. YOUR ATTORNEY CALLS ATTENTION TO SEVERAL RULINGS OF THIS OFFICE WHICH CONSISTENTLY HAVE STOOD FOR THE PROPOSITION THAT COST OF DELIVERY IS ALWAYS A MATTER FOR CONSIDERATION BY THE GOVERNMENT IN DETERMINING WHICH IS IN FACT THE LOWEST BID RECEIVED.

B-150656, MAR. 20, 1963

TO THE YORK CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM DATED JANUARY 17 AND LETTER OF JANUARY 18, 1963, WRITTEN IN BEHALF OF YOUR CORPORATION BY THE LAW FIRM OF GALL, LANE AND HOWE, PROTESTING THE MANNER IN WHICH INVITATION FORBIDS NO. 600-398-63, WAS HANDLED BY THE NAVY PURCHASING OFFICE, WASHINGTON, D.C., DEPARTMENT OF THE NAVY.

AN EXAMINATION OF THE RECORD NOW BEFORE THIS OFFICE INDICATES THAT INVITATION FOR BIDS IFB600-398-63 WAS ISSUED BY THE NAVY PURCHASING OFFICE ON DECEMBER 10, 1962, BASED UPON A REQUIREMENT OF THE BUREAU OF SHIPS FOR FORTY-TWO AIR CONDITIONING PLANTS, TWENTY-ONE RIGHT HAND UNITS AND TWENTY- ONE LEFT HAND UNITS, AND INCLUDING AN OPTION OF STOCK REPAIR PARTS. THE SUPPLIES ARE COVERED BY A NAVY QUALIFIED PRODUCTS LIST. FOUR BIDS WERE SOLICITED, AND FOUR BIDS WERE RECEIVED, OPENED AND TABULATED ON JANUARY 9, 1963, THE TOTALS OF WHICH WERE AS FOLLOWS:

TABLE

WORTHINGTON CORPORATION $252,924.00

YORK CORPORATION 253,050.00

CARRIER AIR CONDITIONING CO. 254,100.00

KECO INDUSTRIES, INC. 281,400.00

IT IS REPORTED THAT AT THE TIME THIS PROCUREMENT WAS ADVERTISED THE BUREAU OF SHIPS INFORMED THE NAVY PURCHASING OFFICE THAT THE DESTINATIONS HAD NOT BEEN DETERMINED AND, THEREFORE, NO DELIVERY POINTS FOR FREIGHT EVALUATION COULD BE FURNISHED. IN VIEW THEREOF, THE INVITATION DID NOT PROVIDE A TRANSPORTATION DATA SHEET FOR BIDDERS TO INDICATE THE GUARANTEED WEIGHTS AND MEASUREMENTS OF THE EQUIPMENT THEY PROPOSED TO SUPPLY, DATA WHICH MUST BE USED IN MAKING AN EVALUATION OF TRANSPORTATION COSTS.

IN HIS LETTER DATED JANUARY 18, 1963, YOUR ATTORNEY CALLS ATTENTION TO SEVERAL RULINGS OF THIS OFFICE WHICH CONSISTENTLY HAVE STOOD FOR THE PROPOSITION THAT COST OF DELIVERY IS ALWAYS A MATTER FOR CONSIDERATION BY THE GOVERNMENT IN DETERMINING WHICH IS IN FACT THE LOWEST BID RECEIVED. HE ALSO CALLS ATTENTION TO PARAGRAPH (B) PLACE OF DELIVERY: ORIGIN: ON PAGE 9 OF THE INVITATION, WHICH READS AS FOLLOWS:

"IN BID EVALUATION THE GOVERNMENT WILL USE THE LOWEST TRANSPORTATION COSTS AVAILABLE FROM ANY OF THE SHIPPING POINTS SPECIFIED BY THE BIDDER IN (C) BELOW. BIDDERS MAY BID SEPARATE PRICES TO REFLECT DIFFERENCES IN COST OF DELIVERY TO THE SHIPPING POINTS DESIGNATED BY THE BIDDER IN (C) BELOW. IT IS TO THE BIDDER'S ADVANTAGE TO FURNISH DATA FOR EACH OF THE SHIPPING POINTS DESCRIBED IN PARAGRAPH (C) BECAUSE THE GOVERNMENT WILL USE ANY PREFERENTIAL TRANSPORTATION RATES WHICH ARE AVAILABLE TO THE GOVERNMENT IN EVALUATING TRANSPORTATION COSTS.'

WE AGREE WITH YOUR ATTORNEY THAT OUR OFFICE CONSISTENTLY HAS HELD THAT THE COST OF DELIVERY IS ALWAYS A MATTER FOR CONSIDERATION BY THE GOVERNMENT IN EVALUATING BIDS. THE REASONS THEREFOR ARE MANIFEST. IMPLEMENTATION OF THIS POLICY, IT IS NOTED THAT SECTION 1-1305.5 OF THE ARMED SERVICES PROCUREMENT REGULATION EVEN GOES SO FAR AS TO PROVIDE THAT-

"WHEN THE EXACT DESTINATIONS OF THE SUPPLIES BEING PURCHASED ARE NOT KNOWN AT THE TIME BIDS OR PROPOSALS ARE SOLICITED, BUT THE LOCATION OF THE DESTINATION, SUCH AS EAST COAST, MIDDLE WEST, OR WEST COAST, IS KNOWN, A DEFINITE PLACE OR PLACES SHALL BE DESIGNATED AS THE POINT TO WHICH TRANSPORTATION COSTS WILL BE COMPUTED--- BUT ONLY FOR THE PURPOSE EVALUATING BIDS OR PROPOSALS. * * *"

THE RECORD CLEARLY INDICATES THAT THE DEPARTMENT OF THE NAVY WAS FULLY AWARE OF OUR DECISIONS AND THE ABOVE-QUOTED REGULATION. HOWEVER, IT IS REPORTED THAT IN THE INSTANT CASE THE BUREAU OF SHIPS, THE REQUIRING ACTIVITY, WAS AND STILL IS UNABLE TO ANTICIPATE EVEN THE GENERAL LOCATIONS WHERE THE MATERIAL WOULD BE USED BECAUSE OF THE PROBABILITY THAT THE UNITS MAY BE INSTALLED IN VESSELS AT ANY OF NUMEROUS SHIPYARDS. IT IS OBVIOUS THAT TRANSPORTATION COSTS CANNOT BE INCLUDED AS A BID EVALUATION FACTOR WHERE DESTINATIONS ARE UNKNOWN. IN THIS PARTICULAR CASE IT SHOULD BE NOTED ALSO THAT EVEN IF DESTINATIONS WERE NOW KNOWN IT WOULD BE IMPOSSIBLE TO COMPUTE TRANSPORTATION COSTS BECAUSE OF THE ABSENCE OF GUARANTEED WEIGHT AND MEASUREMENT DATA IN THE BIDS. SUCH DATA, OF COURSE, MAY NOT BE SUPPLIED AFTER BID OPENING SINCE THIS WOULD CONSTITUTE A MODIFICATION OF THE BIDS.

WE AGREE THAT BECAUSE OF THE UNUSUAL CIRCUMSTANCES PRESENT THE ABOVE- QUOTED PARAGRAPH (B) HAD NO PERTINENCY IN THIS PARTICULAR INVITATION, AND WE ARE INFORMED THAT THE NAVY PURCHASING OFFICE HAS BEEN REQUESTED TO MODIFY THIS CLAUSE IN FUTURE PROCUREMENTS WHERE NO DESTINATION IS SPECIFIED. HOWEVER, WE ARE AWARE OF NO LEGAL BASIS FOR CONCLUDING THAT THE INVITATION WAS HANDLED IN AN IMPROPER MANNER, AND YOUR PROTEST IS THEREFORE DENIED.