B-151633, JUL. 17, 1963

B-151633: Jul 17, 1963

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TO THE SECRETARY OF THE INTERIOR: REFERENCE IS MADE TO A LETTER DATED JUNE 24. ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. 14-20- 0200-1320 IS BASED. THE BID OF THE COMPANY WAS ACCEPTED ON NOVEMBER 8. 869.57 WERE MADE THEREON. 454 AND THAT THE GOVERNMENT ESTIMATE WAS $15. CONSIDERING THE FACT THAT THERE IS ONLY A DIFFERENCE OF $187 BETWEEN THESE TWO BIDS ON A $16. 000 JOB AND THE ADDITIONAL FACT THAT THE AGGREGATE BID OF THE S AND B CONSTRUCTION COMPANY IS $374.22 LESS THAN THE LOWER OF THOSE AGGREGATE BIDS. IT APPEARS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR IN THE COMPANY'S BID OF $12. THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE COMPANY TO VERIFY ITS BID.

B-151633, JUL. 17, 1963

TO THE SECRETARY OF THE INTERIOR:

REFERENCE IS MADE TO A LETTER DATED JUNE 24, 1963, WITH ENCLOSURES, FROM THE ASSISTANT SECRETARY OF THE INTERIOR, FURNISHING THE REPORT REQUESTED BY OUR OFFICE RELATIVE TO AN ERROR WHICH THE S AND B CONSTRUCTION COMPANY, LAWTON, OKLAHOMA, ALLEGES IT MADE IN ITS BID ON WHICH CONTRACT NO. 14-20- 0200-1320 IS BASED.

THE BUREAU OF INDIAN AFFAIRS, ANADARKO AREA OFFICE, BRANCH OF PLANT MANAGEMENT, ANADARKO, OKLAHOMA, BY INVITATION NO. APM-32 REQUESTED BIDS FOR FURNISHING LABOR AND MATERIALS AND FOR PERFORMING ALL WORK REQUIRED FOR THE REMODELING OF KITCHENS AND BATHROOMS AT THE FORT STILL INDIAN SCHOOL, LAWTON, OKLAHOMA. IN RESPONSE THE S AND B CONSTRUCTION COMPANY SUBMITTED A BID DATED OCTOBER 12, 1962, OFFERING TO PERFORM THE WORK FOR THE AGGREGATE TOTAL PRICE OF $12,523.78. THE BID OF THE COMPANY WAS ACCEPTED ON NOVEMBER 8, 1962.

IT APPEARS THAT SHORTLY AFTER RECEIVING THE AWARD, A REPRESENTATIVE OF THE COMPANY ORALLY ADVISED THE CONTRACTING OFFICE THAT THE COMPANY HAD MADE A MISTAKE ON ITS WORKSHEETS FOR THE JOB. THE COMPANY CONFIRMED ITS VERBAL ALLEGATION OF ERROR BY LETTER DATED NOVEMBER 14, 1962.

BY LETTER DATED NOVEMBER 29, 1962, THE S AND B CONSTRUCTION COMPANY REQUESTED THAT THE CONTRACT PRICE OF THE WORK BE INCREASED BY $2,869.57 TO COVER CERTAIN ERRORS IN ADDITION MADE BY THE COMPANY ON ITS WORKSHEETS. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY SUBMITTED ITS WORKSHEETS WHICH SHOW THAT ERRORS IN ADDITION AMOUNTING TO $2,869.57 WERE MADE THEREON.

THE RECORD INDICATES THAT THE TWO OTHER BIDDERS ON THE WORK QUOTED AGGREGATE TOTAL PRICES OF $16,267 AND $16,454 AND THAT THE GOVERNMENT ESTIMATE WAS $15,700. CONSIDERING THE FACT THAT THERE IS ONLY A DIFFERENCE OF $187 BETWEEN THESE TWO BIDS ON A $16,000 JOB AND THE ADDITIONAL FACT THAT THE AGGREGATE BID OF THE S AND B CONSTRUCTION COMPANY IS $374.22 LESS THAN THE LOWER OF THOSE AGGREGATE BIDS, IT APPEARS THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR IN THE COMPANY'S BID OF $12,523.78 AND, CONSEQUENTLY, THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE COMPANY TO VERIFY ITS BID.

WE AGREE WITH THE STATEMENT OF THE ASSISTANT SECRETARY THAT THERE IS LITTLE ROOM FOR DOUBT THAT THE COMPANY MADE AN ERROR IN ITS BID, AS ALLEGED. ALSO, WHILE WE AGREE WITH HIS STATEMENT THAT THERE IS NO CONSISTENCY IN THE METHOD FOLLOWED BY THE COMPANY IN ARRIVING AT THE INSURANCE AND PROFIT AMOUNTS USED BY IT ON ITS WORKSHEETS, WE ARE OF THE OPINION THAT IN VIEW OF THE COMPANY'S STATEMENT THAT IT DID NOT USE A PERCENTAGE BUT ESTIMATED THE AMOUNTS FOR PROFIT AND INSURANCE AND THE FACT THAT THIS WAS THE COMPANY'S FIRST GOVERNMENT JOB, CORRECTION OF THE COMPANY'S BID TO THE REQUESTED AMOUNT SHOULD BE PERMITTED, PARTICULARLY SINCE SUCH AMOUNT WILL STILL BE BELOW THE AMOUNT OF THE NEXT LOWEST BID RECEIVED ON THE PROJECT. IT IS REPORTED THAT ALL WORK UNDER THE CONTRACT HAS BEEN COMPLETED BUT THAT FINAL PAYMENT FOR SUCH WORK HAS NOT BEEN MADE. ACCORDINGLY, CONTRACT NO. 14-20-0200-1320 MAY BE AMENDED TO PROVIDE FOR AN AGGREGATE TOTAL PRICE OF $15,393.35 FOR THE WORK, AS RECOMMENDED BY THE CONTRACTING OFFICER AND PAYMENT FOR THE WORK PERFORMED IS AUTHORIZED TO BE MADE ON THAT BASIS.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO THE CONTRACT.