B-150688, FEB. 11, 1963

B-150688, FEB. 11, 1963

TO ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION:

REFERENCE IS MADE TO A LETTER DATED JANUARY 23, 1963, WITH ENCLOSURES, FROM THE ACTING ADMINISTRATOR, CONCERNING PROPOSED READVERTISEMENT FOR BIDS ON METAL FOOD STORAGE SHELVING DESIRED FOR ULTIMATE DELIVERY TO THE CLARK AIR FORCE BASE, PHILIPPINE ISLANDS.

UNDER INVITATION FOR BIDS NO. SFV-3183-63, ISSUED ON OCTOBER 8, 1962, BY THE FEDERAL SUPPLY SERVICE AT THE GENERAL SERVICES ADMINISTRATION'S REGIONAL OFFICE IN SAN FRANCISCO, CALIFORNIA, BIDS WERE INVITED ON METAL FOOD STORAGE SHELVING TO BE IN ACCORDANCE WITH "SPECIFICATION MIL-S-40144, TYPE 1, GRADE B, CHROME-PLATED. K.D. PACKING LEVEL C.' THE BIDDING SCHEDULE WAS SO ARRANGED AS TO PERMIT SEPARATE PRICING ON THE REQUIRED 675 UPRIGHTS (ITEM NO. 1) AND FOR THE REQUIRED 855 SHELVES (ITEM NO. 2).

SEVEN FIRMS SUBMITTED BIDS. ON NOVEMBER 21, 1962, PURCHASE ORDERS WERE ISSUED ACCEPTING THE BID OF THE METROPOLITAN WIRE GOODS CORPORATION, WILKES-BARRE, PENNSYLVANIA, ON ITEM NO. 1 AND THE BID OF THE AMCO WIRE PRODUCTS CORPORATION, CHICAGO, ILLINOIS, ON ITEM NO. 2. THE ACCEPTED LOW BID PRICES TOTALED THE SUM OF $6,048. THE AMCO WIRE PRODUCTS CORPORATION HAD QUOTED PRICES ON ITEMS NOS. 1 AND 2 WHICH AGGREGATED THE AMOUNT OF $6,291 AND THE BID PRICES OF THE METROPOLITAN WIRE GOODS CORPORATION AGGREGATED THE AMOUNT OF $6,646.50.

THE CIRCUMSTANCES GIVING RISE TO THE ADMINISTRATIVE DETERMINATION THAT THERE SHOULD BE A READVERTISEMENT FOR BIDS ARE BRIEFLY SET FORTH IN A REPORT OF THE CONTRACTING OFFICER. APPROXIMATELY ONE WEEK AFTER THE CONTRACT AWARDS WERE MADE THE PURCHASING OFFICE WAS ADVISED BY THE AMCO WIRE PRODUCTS CORPORATION THAT ITS SHELVES WOULD NOT FIT THE UPRIGHTS AS MANUFACTURED BY THE METROPOLITAN WIRE GOODS CORPORATION. THE LATTER FIRM AGREED THAT SHELVES MANUFACTURED BY ANOTHER MANUFACTURER WOULD NOT NECESSARILY FIT THE UPRIGHTS WHICH IT PROPOSED TO FURNISH, AND SUGGESTED THAT AN INCOMPATIBILITY BETWEEN THE PRODUCTS OF DIFFERENT MANUFACTURERS NORMALLY COULD BE EXPECTED SINCE THE GOVERNMENT'S SPECIFICATION "IS A LOOSE ONE AND ABOUT THE ONLY THING REQUIRED IS THAT THE SHELVING BE OF OPEN CONSTRUCTION.' THE METROPOLITAN WIRE GOODS CORPORATION SUBSEQUENTLY REFUSED TO CONSENT TO A CANCELLATION OF ITS ORDER UNLESS THE BID REQUIREMENTS WERE READVERTISED. THE AMCO WIRE PRODUCTS CORPORATION PROTESTED ANY POSSIBLE READVERTISEMENT, CONTENDING THAT IT WAS ENTITLED TO RECEIVE AN AMENDED CONTRACT AWARD COVERING BOTH ITEMS OF THE INVITATION SINCE AMCO HAD SUBMITTED THE LOWEST AGGREGATE BID.

IT IS STATED IN THE LETTER DATED JANUARY 23, 1963, THAT THE AWARDS ARE BEING CANCELED AND THE ITEMS ARE TO BE READVERTISED. IT IS PROPOSED TO PERMIT THE NEW ADVERTISEMENT TO GO FORWARD, WITH AWARD TO BE MADE TO THE LOW BIDDER IN THE AGGREGATE IF WE CONCUR. THE OPINION IS EXPRESSED THAT ONE OF THE PROTESTING BIDDER'S ARGUMENTS IS VALID IN THAT ITS POSITION IS NOW LESS FAVORABLE SINCE ITS BID PRICES WERE EXPOSED. HOWEVER, REFERENCE IS MADE TO 40 COMP. GEN. 352 AS HAVING CONCLUDED THAT, WHEN THE CONDITIONS ARE SUCH THAT REJECTION (OR CANCELLATION) IS NECESSARY, THE EXPOSURE OF BID PRICES IS A REGRETTABLE INCIDENT OF SUCH ACTION WHICH CANNOT BE AVOIDED.

THE DECISION TO READVERTISE IS BASED UPON THE FOLLOWING STATED FACTORS: (1) THE PRODUCTS THAT WOULD HAVE BEEN PROCURED UNDER THE ACCEPTED BIDS ARE NOT COMPATIBLE AND A PROPORTIONATELY SEVERE FINANCIAL LOSS WOULD BE ENTAILED IF DELIVERIES WERE PERMITTED OF BOTH PRODUCTS; (2) READVERTISEMENT WOULD MEET THE CONDITIONS OF THE METROPOLITAN WIRE GOODS CORPORATION FOR CANCELLATION OF ITS ORDER; AND (3) ALTHOUGH THE AMCO WIRE PRODUCTS CORPORATION COULD ASSERT A CLAIM ON ACCOUNT OF A CANCELLATION OF ITS ORDER, IT IS PROBABLE THAT SUCH A CLAIM WOULD BE GREATLY REDUCED OR ELIMINATED IF AMCO SUBMITTED THE LOWEST ACCEPTABLE AGGREGATE BID IN RESPONSE TO THE NEW INVITATION.

THE AMCO WIRE PRODUCTS CORPORATION HAS CITED PARAGRAPH 8 OF THE TERMS AND CONDITIONS OF THE ORIGINAL INVITATION AS INDICATING THAT AN AGGREGATE AWARD WOULD HAVE BEEN PROPER IF THE GOVERNMENT HAD KNOWN THAT THE STANDARD PRODUCTS OF THE LOW BIDDERS ON THE SEPARATE ITEMS (UPRIGHTS AND SHELVES) COULD NOT BE USED TOGETHER. WE NEVERTHELESS ARE OF THE OPINION THAT THE AWARD ACTION WHICH WAS TAKEN PRECLUDES A RECONSIDERATION OF THE BIDS ON AN AGGREGATE PRICE BASIS, PARTICULARLY SINCE THE SUCCESSFUL BIDDER ON THE UPRIGHTS HAS REFUSED TO ACCEPT A CANCELLATION OF ITS CONTRACT WITH THE GOVERNMENT EXCEPT IN THE EVENT OF A READVERTISEMENT FOR BIDS ON THE EQUIPMENT INVOLVED.

ACCORDINGLY, WE AGREE THAT THE CIRCUMSTANCES OF THE CASE WARRANT THE ISSUANCE OF A NEW INVITATION FOR BIDS WITH A VIEW TOWARD MAKING AN AWARD TO THE LOW BIDDER IN THE AGGREGATE. A COPY OF THIS DECISION IS BEING MAILED TO THE AMCO WIRE PRODUCTS CORPORATION.