B-152731, JAN. 28, 1964

B-152731: Jan 28, 1964

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INC.: REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 22. THE CONTRACT WAS AWARDED TO THE MARGOLIS SALT COMPANY PURSUANT TO INVITATION FOR BIDS NO. 68-145-4-0152-B. FOR BIDDING PURPOSES THE REQUIREMENTS OF THE DISTRICT FOR ROCK SALT WERE SET FORTH IN TERMS OF ESTIMATED QUANTITIES AS FOLLOWS: 2. THE INVITATION FOR BIDS WAS MODIFIED BY ADDENDA NOS. 1 AND 2. THE BID OF THE MARGOLIS SALT COMPANY WAS ACCEPTED ON THE BASIS OF ITS F.O.B. IN ACCEPTING THE BID THE TOTAL ESTIMATED CONTRACT PRICE WAS SHOWN TO BE $369. THE REMAINING FOUR BIDS WERE SUBMITTED BY CAYUGA ROCK SALT COMPANY. WAS THE COMPANY WHICH HAD INDICATED THAT IT WOULD SUBMIT A BID IF PERMITTED TO SHIP THE MATERIAL BY BOAT TO BALTIMORE AND ARRANGE FOR TRUCK DELIVERIES FROM THAT POINT TO WASHINGTON.

B-152731, JAN. 28, 1964

TO THE HARVEY SALT COMPANY, INC.:

REFERENCE IS MADE TO YOUR LETTER DATED OCTOBER 22, 1963, AND SUBSEQUENT CORRESPONDENCE, RELATIVE TO YOUR PROTEST AGAINST A PART OF THE CONTRACT AWARDED TO THE MARGOLIS SALT COMPANY, WASHINGTON, D.C., BY THE PROCUREMENT OFFICE OF THE GOVERNMENT OF THE DISTRICT OF COLUMBIA, FOR DELIVERIES OF ROCK SALT AS REQUIRED AND ORDERED BY THE DISTRICT DURING THE PERIOD EXTENDING FROM THE DATE OF CONTRACT AWARD (SEPTEMBER 25, 1963) THROUGH AUGUST 1, 1964.

THE CONTRACT WAS AWARDED TO THE MARGOLIS SALT COMPANY PURSUANT TO INVITATION FOR BIDS NO. 68-145-4-0152-B, ISSUED AUGUST 1, 1963, WITH A SCHEDULED PUBLIC BID OPENING DATE OF AUGUST 27, 1963. FOR BIDDING PURPOSES THE REQUIREMENTS OF THE DISTRICT FOR ROCK SALT WERE SET FORTH IN TERMS OF ESTIMATED QUANTITIES AS FOLLOWS: 2,280 TONS IN BULK, MINIMUM SHIPMENT - 60 TONS, SINGLE CARLOAD; 30,000 TONS IN BULK, 9 CAR MINIMUM, 500 TONS; AND 2,000 TONS IN 100-POUND BAGS, MINIMUM SHIPMENT - 40 TONS. IN EACH CATEGORY THE ORIGINAL INVITATION REQUESTED QUOTATION OF PRICES (A) F.O.B. MINE, ORIGIN, AND (B) F.O.B. DESTINATION.

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

THE MARGOLIS SALT COMPANY SUBMITTED A BID IN WHICH IT OFFERED TO MAKE DELIVERIES AT THE FOLLOWING F.O.B. SHIPPING POINT AND DESTINATION PRICES: AN F.O.B. BALTIMORE SHIPPING POINT PRICE OF $9.35 PER TEN FOR ITEMS 1A AND 2A; AN F.O.B. WASHINGTON SHIPPING POINT PRICE OF $22.50 PER TON FOR ITEM 3A; A DESTINATION PRICE OF $11.95 PER TON FOR ITEMS 1B AND 2B; AND A DESTINATION PRICE OF $23.50 PER TON FOR ITEM 3B. THE BID SPECIFIED MORTON, OHIO, AS THE PLACE OF MANUFACTURE OR SUPPLY. THE BIDDER ALSO PROPOSED TO MAKE DELIVERIES UNDER ITEMS 1B, 2B AND 3B BY TRUCK TO DESTINATIONS AS REQUIRED IN THE DISTRICT OF COLUMBIA.

UPON CONSIDERATION OF FREIGHT COSTS IN THE EVALUATION OF THE FIVE BIDS RECEIVED IN RESPONSE TO THE INVITATION, THE BID OF THE MARGOLIS SALT COMPANY WAS ACCEPTED ON THE BASIS OF ITS F.O.B. SHIPPING POINT PRICES FOR THE THREE BASIC ITEMS OF THE INVITATION. IN ACCEPTING THE BID THE TOTAL ESTIMATED CONTRACT PRICE WAS SHOWN TO BE $369,198, INCLUDING APPROXIMATELY $22,380 AS A COST DIFFERENTIAL TO BE PAID BY THE DISTRICT TO THE CONTRACTOR FOR DIVERTING CARS FROM THE F.O.B. POINT, BALTIMORE, MARYLAND, TO WASHINGTON, D.C. THE FREIGHT COST DIFFERENTIALS INVOLVED BAD REFERENCE TO AN AGREEMENT REACHED BETWEEN THE DISTRICT AND THE CONTRACTOR RELATIVE TO ITEMS 1A AND 2A AS TO WHICH THE CONTRACTOR HAD AGREED AFTER OPENING OF BIDS TO GRANT RECONSIGNMENT RIGHTS FROM ITS MINE IN MORTON, OHIO, FOR DELIVERY F.O.B. CARS AT SIDINGS IN WASHINGTON, D.C., RATHER THAN BALTIMORE, SUBJECT TO PAYMENT BY THE DISTRICT OF FREIGHT DIFFERENTIALS IN THE RESPECTIVE AMOUNTS OF $1 AND $0.67 PER TON IN ADDITION TO THE F.O.B. SHIPPING POINT (BALTIMORE, MARYLAND) PRICE OF $9.35 PER TON QUOTED FOR ITEMS 1A AND 2A.

THE REMAINING FOUR BIDS WERE SUBMITTED BY CAYUGA ROCK SALT COMPANY, INC., MYERS, NEW YORK, CARGILL, INC., MINNEAPOLIS, MINNESOTA, POTOMAC SAND AND GRAVEL COMPANY, WASHINGTON, D.C., AND SOUTHERN SALT COMPANY, INC., NORFOLK, VIRGINIA. CARGILL, INC., WAS THE COMPANY WHICH HAD INDICATED THAT IT WOULD SUBMIT A BID IF PERMITTED TO SHIP THE MATERIAL BY BOAT TO BALTIMORE AND ARRANGE FOR TRUCK DELIVERIES FROM THAT POINT TO WASHINGTON, D.C. IT DID NOT BID ON ITEMS 3A AND 3B AND IT QUOTED PRICES OF $10.25 AND $12.25 FOR ITEMS 1A AND 2A, AND FOR ITEMS 1B AND 2B, INDICATING THAT IT PROPOSED F.O.B. DESTINATION PRICE OF $12.25 WOULD INCLUDE TRANSPORTATION BY TRUCK FROM BALTIMORE TO WASHINGTON. THE THREE OTHER BIDDERS QUOTED IDENTICAL PRICES EXCEPT IN THE CASE OF ITEM 2B FOR WHICH TWO BIDDERS QUOTED $12.35 PER TON AND THE POTOMAC SAND AND GRAVEL COMPANY QUOTED $11.28 PER TON.

THE PROCUREMENT OFFICE OF THE GOVERNMENT OF THE DISTRICT OF COLUMBIA CONSIDERED THAT THE MARGOLIS SALT COMPANY'S WASHINGTON, D.C., SHIPPING POINT PRICE OF $22.50 PER TON FOR ITEM 3A WAS EQUIVALENT FOR BID EVALUATION PURPOSES TO THE DESTINATION BIDS IN THE SAME AMOUNT WHICH WERE SUBMITTED BY THE THREE OTHER BIDDERS. WITH RESPECT TO ITEMS 1A AND 1B, IT APPEARS THAT THE RELATIVE STANDING OF THE FIVE BIDDERS WAS NOT AFFECTED BY THE NEGOTIATIONS WHICH TOOK PLACE BETWEEN THE DISTRICT AND THE MARGOLIS SALT COMPANY AFTER PUBLIC OPENING OF BIDS. THE QUESTION HAS BEEN RAISED, HOWEVER, AS TO WHETHER THIS SAME CONCLUSION WOULD BE JUSTIFIED IN REGARD TO THE PRICES QUOTED BY THE MARGOLIS SALT COMPANY AND THE POTOMAC SAND AND GRAVEL COMPANY FOR ITEMS 2A AND 2B WHICH COVERED THE LARGEST PORTION OF THE DISTRICT'S ESTIMATED REQUIREMENTS FOR ROCK SALT DURING THE 1963-1964 WINTER SEASON.

YOU ALLEGE THAT THE POTOMAC SAND AND GRAVEL COMPANY IS YOUR AGENT FOR THE DISTRICT OF COLUMBIA AND TAKE EXCEPTION ON ITS BEHALF TO THE AWARD MADE TO THE MARGOLIS SALT COMPANY FOR ITEM 2A UNDER WHICH THE DELIVERED COST TO THE DISTRICT WAS DETERMINED TO BE $10.02 PER TON, CONSISTING OF MARGOLIS' QUOTED SHIPPING POINT PRICE OF $9.35 PER TON PLUS A FREIGHT DIFFERENTIAL OF $0.67 PER TON FOR "DIVERSION" OF SHIPMENTS ORIGINATING AT THE COMPANY'S MINE IN MORTON, OHIO, FROM BALTIMORE TO WASHINGTON. IT IS YOUR CONTENTION THAT, IF THE BIDS ON ITEMS 2A AND 2B HAD BEEN EVALUATED PROPERLY, NO AWARD SHOULD HAVE BEEN MADE ON ITEM 2A AND AN AWARD SHOULD HAVE BEEN MADE TO THE POTOMAC SAND AND GRAVEL COMPANY ON THE BASIS OF ITS QUOTED F.O.B. DESTINATION PRICE OF $11.28 PER TON FOR ITEM 28. IT IS ARGUED IN EFFECT THAT THE MARGOLIS SALT COMPANY'S BID PRICES FOR ITEMS 2A AND 2B, AND A TRUCK RATE OF $2.60 PER TON FOR DELIVERY OF BULK QUANTITIES OF ROCK SALT FROM BALTIMORE TO WASHINGTON SHOW A DELIVERED COST OF 11.95 PER TON UPON ACCEPTANCE OF THAT COMPANY'S ORIGINAL BID UNDER EITHER ITEM 2A OR 2B OF THE INVITATION; AND THAT THE BIDDER SHOULD NOT HAVE BEEN PERMITTED AFTER OPENING OF BIDS TO CHANGE ITS BID PRICE ON ITEM 2A BY OFFERING TO ALLOW A FREIGHT COST DIFFERENTIAL OF $0.67 PER TON IN CONNECTION WITH ITS QUOTATION OF $9.35 PER TON, F.O.B. BALTIMORE, MARYLAND, BASED UPON SHIPMENT BY RAIL TRANSPORTATION DIRECTLY TO WASHINGTON FROM THE COMPANY'S MINE IN MORTON, OHIO.

YOU STATE THAT THERE IS NO EXISTING MULTIPLE CAR RAILROAD RATE BETWEEN BALTIMORE AND WASHINGTON FOR SHIPMENT OF BULK QUANTITIES OF ROCK SALT, AND THAT THE LOWEST SINGLE CAR RAIL RATE IS $4.90 PER TON. ALSO, WITH RESPECT TO THE MULTIPLE CAR RATE OF $5.95 ESTABLISHED BY CARRIER QUOTATION AS AUTHORIZED UNDER SECTION 22, TITLE 49, UNITED STATES CODE, FOR SHIPMENT FROM MORTON, OHIO, TO WASHINGTON, D.C., AS COMPARED WITH THE MULTIPLE CAR RATE OF $5.28 FOR SHIPMENT FROM MORTON, OHIO, TO BALTIMORE, MARYLAND, WHICH RATES WERE USED IN COMPUTING THE FREIGHT COST DIFFERENTIAL OF $0.67 PER TON, YOU INDICATE THAT YOU HAVE RECEIVED INFORMATION FROM THE ORIGINATING CARRIER, THE NEW YORK CENTRAL RAILROAD, THAT A DIVERSION CHARGE OF $6 IS REQUIRED UNDER FREIGHT TARIFF (ICC 2302, NYC 5402H) "IF CAR HAS NOT LEFT ITS POINT OF ORIGIN" AND THAT A CHARGE OF $10.12 PER CAR IS REQUIRED AFTER MOVEMENT FROM POINT OF ORIGIN. (THOSE CHARGES WOULD NOT APPEAR TO BE FOR APPLICATION IN THIS CASE SINCE THE COMMERCIAL BILLS OF LADING COVERING THE CONTRACT DELIVERIES OBVIOUSLY WOULD INITIALLY SPECIFY WASHINGTON, D.C., RATHER THAN BALTIMORE, MARYLAND, AS THE POINT OF DESTINATION. IN ANY EVENT, SUCH CHARGES WOULD BE EQUIVALENT TO THE APPROXIMATE AMOUNTS OF $0.10 AND $0.17 PER TON, AND THE DISTRICT WOULD BE PAYING THE CONTRACTOR A MAXIMUM OF $10.19 PER TON AS COMPARED WITH THE F.O.B. DESTINATION PRICE OF $11.28 PER TON QUOTED BY THE POTOMAC SAND AND GRAVEL COMPANY.)

YOUR REPRESENTATIVES CONTENDED AT A MEETING IN THIS OFFICE ON OCTOBER 30, 1963, THAT ROCK SALT HAS A STANDARD MINE PRICE OF $6.40 PER TON FOR BULK DELIVERY, AND INDICATED THAT YOUR COMPANY WAS SUCCESSFUL IN DEFENDING AN ANTI-TRUST SUIT PREMISED UPON THE SUBMISSION OF IDENTICAL BID PRICES. WAS ALLEGED THAT BIDDERS STILL QUOTE THE SAME PRICES F.O.B. MINES, LEAVING ONLY DIFFERENCES IN FREIGHT COSTS AVAILABLE FOR TRUE COMPETITIVE BIDDING. WE NOTE, HOWEVER THAT THE RAILROAD RATE FOR MULTIPLE CAR SHIPMENTS OF ROCK SALT FROM RETSOF, NEW YORK, THE SHIPPING POINT DESIGNATED BY THE POTOMAC SAND AND GRAVEL COMPANY, TO WASHINGTON, D.C., IS $5.95 PER TON, INDICATING A TOTAL DELIVERED COST OF $12.35 PER TON ($6.40 PLUS $5.95). THE POTOMAC SAND AND GRAVEL COMPANY OR YOUR COMPANY, AS PRINCIPAL, EVIDENTLY INTENDED TO ABSORB $1.07 OF THE FREIGHT COST PER TON IN CONNECTION WITH ITS OFFER TO MAKE DELIVERY TO DESTINATION AT A PRICE OF $11.28 PER TON UNDER ITEM 2B OF THE INVITATION FOR BIDS, WHICH WOULD HAVE HAD THE EFFECT OF REDUCING YOUR STANDARD F.O.B. MINE PRICE TO $5.33 PER TON ON MULTIPLE CAR SHIPMENTS.

ACCORDING TO A REPORT WHICH WE RECEIVED FROM THE PRESIDENT OF THE BOARD OF COMMISSIONERS, DISTRICT OF COLUMBIA, THE PROCUREMENT HERE INVOLVED REPRESENTS A SUCCESSFUL EFFORT ON THE PART OF THE DISTRICT TO STIMULATE COMPETITION IN AN INDUSTRY WHICH PRIOR TO 1961 SUBMITTED ONLY IDENTICAL BIDS WITH PRICES MORE THAN 50 PERCENT ABOVE THOSE IN THE CURRENT CONTRACT. IT IS STATED IN THE REPORT THAT IN ANALYZING THE BIDS RECEIVED UNDER THIS INVITATION THE DISTRICT FOUND THREE IDENTICAL BIDS OF $6.40 PER TON F.O.B. SHIPPING POINT; THAT ALL THREE OF THOSE BIDS WERE PRICED AT THE MINE; AND THAT THE MARGOLIS BID CLEARLY INDICATED THAT THE ROCK SALT WHICH IT PROPOSED TO FURNISH WOULD BE PRODUCED IN MORTON, OHIO. THE REPORT FURTHER STATES, IN PERTINENT PART, THAT:

"BASED ON INFORMATION CONTAINED IN THE BID AND THE SPECIFICATIONS THEREIN, THE DISTRICT PROCUREMENT OFFICE CONTRACTED THE CARRIER AND ASCERTAINED THE FREIGHT DIFFERENTIAL BETWEEN WASHINGTON AND BALTIMORE BASED ON SHIPMENT FROM MORTON, OHIO. THIS DIFFERENTIAL WAS 67 CENTS PER TON. THEREFORE, THE DISTRICT ACCEPTED THE BID AT $9.35 "F.O.B. BALTIMORE" PLUS THE 67 CENTS FREIGHT DIFFERENTIAL BETWEEN BALTIMORE AND WASHINGTON FOR A TOTAL COST OF $10.02 PER TON WITH THE DISTRICT PAYING THE 67 CENTS FREIGHT DIFFERENTIAL AS A SEPARATE ITEM AS REQUIRED BY THE SPECIFICATIONS. IRRESPECTIVE OF THE PRICING OF THE VARIOUS ITEMS IN THE INVITATION, IT WAS PLAINLY THE INTENT OF THE DISTRICT TO AWARD THE CONTRACT BASED ON THE LOWEST ULTIMATE COST OF THE SALT DELIVERED TO ITS FINAL DESTINATION. THIS INTENT IS MADE AMPLY CLEAR IN THE SPECIFICATIONS WHICH POINT OUT THAT THE SODIUM CHLORIDE IS FOR DELIVERY TO DISTRICT OF COLUMBIA GOVERNMENT AND FEDERAL AGENCIES LOCATED IN THE DISTRICT OF COLUMBIA.

"ACCEPTANCE OF THIS LOW BID WAS DEFINITELY IN THE BEST INTEREST OF THE DISTRICT OF COLUMBIA GOVERNMENT. EVERY ACTION TAKEN IN THE COURSE OF THIS PARTICULAR OPENING, AS WELL AS THOSE IN PRIOR YEARS, CONTRIBUTED STRONGLY TO STIMULATING COMPETITION. IN FACT, AS A RESULT OF THE DISTRICT'S EFFORTS TO BRING ABOUT A COMPETITIVE SITUATION IN THE PROCUREMENT OF SALT, THE COST OF THIS MATERIAL TO THE DISTRICT HAS BEEN REDUCED FROM $15.70 PER TON IN 1960 TO $10.02 PER TON IN 1963. IN 1960 AND FOR MANY YEARS PRIOR TO THAT TIME ALL BIDS RECEIVED ON THIS PRODUCT WERE IDENTICAL AND THERE WAS A CONSISTENT INCREASE IN THE PRICE OF SALT YEAR AFTER YEAR. BY VIRTUE OF PRICE REDUCTIONS WE HAVE OBTAINED, THROUGH OUR EFFORTS TO STIMULATE COMPETITIVE BIDDING, A TOTAL SAVINGS ON SALT SINCE 1960 IN EXCESS OF $450,000. THIS SAVINGS IS EXTREMELY IMPORTANT TO THE DISTRICT BECAUSE, WITH THE REMOVAL OF STREETCARS FROM CITY STREETS, IT HAS BEEN POSSIBLE TO USE SALT IN SNOW EMERGENCY ON MANY STREETS WHICH BEFORE THAT TIME COULD NOT BE SO TREATED BECAUSE OF DAMAGES TO ELECTRICAL CIRCUITS OPERATING THE STREETCARS. THE SAVINGS HAS MADE IT POSSIBLE FOR US TO ABSORB MUCH OF THE ADDED EXPENSE OF TREATING THESE ADDITIONAL STREETS WITH SALT IN SNOW EMERGENCIES RATHER THAN TO SEEK APPROPRIATION INCREASES.

"FURTHER, THE LATE PRESIDENT OF THE UNITED STATES IN HIS EXECUTIVE ORDER 10936 OF APRIL 24, 1961, SET FORTH HIS STRENUOUS OBJECTIONS TO COLLUSIVE BIDDING PRACTICES IN GENERAL AND TO IDENTICAL BIDDING ON PUBLIC NEEDS IN PARTICULAR. THE ACTIONS WE HAVE TAKEN IN THE PROCUREMENT OF SALT ARE IN THE BEST TRADITIONS OF THIS ORDER AND WE FEEL ARE CERTAINLY IN KEEPING WITH THE RECENT PRONOUNCEMENT OF PRESIDENT JOHNSON CONCERNING THE NEED FOR COST CONSCIOUSNESS IN GOVERNMENTAL PROCUREMENT.' IT IS AN ESTABLISHED PRINCIPLE OF FORMAL COMPETITIVE PROCUREMENT BY GOVERNMENTAL AGENCIES THAT BIDDERS SHOULD NOT BE PERMITTED TO CHANGE THEIR PROPOSALS AFTER BIDS ARE OPENED; AND IT HAS BEEN OUR POSITION THAT NEGOTIATION WITH A BIDDER CONCERNING HIS OFFERED PRICES WOULD BE IMPROPER IF THE CIRCUMSTANCES OF THE PARTICULAR CASE ARE SUCH AS TO INDICATE THAT THE BIDDER WOULD THEREBY OBTAIN AN UNFAIR ADVANTAGE OVER OTHER BIDDERS.

HOWEVER, AS INDICATED IN THE REPORT OF THE PRESIDENT OF THE BOARD OF COMMISSIONERS, DISTRICT OF COLUMBIA, THE FACT THAT THE DISTRICT INTENDED TO AWARD ONE OR MORE CONTRACTS BASED UPON THE LOWEST ULTIMATE COST OF THE ROCK SALT DELIVERED TO ITS FINAL DESTINATION WAS MADE AMPLY CLEAR IN THE BID SPECIFICATIONS. FURTHERMORE, IT WAS APPARENT FROM THE BID OF THE MARGOLIS SALT COMPANY THAT THIS BIDDER ACTUALLY INTENDED TO SUPPLY ALL OF THE ROCK SALT REQUIRED FOR DELIVERY UNDER ITEMS 1A AND 2A FROM CURRENT PRODUCTION AT ITS MINE IN MORTON, OHIO, ALTHOUGH THE QUOTED PRICE OF $9.35 PER TON WAS BASED UPON DELIVERY, F.O.B. CARRIER, AT BALTIMORE, MARYLAND.

IT IS OUR OPINION THAT THE PROCUREMENT OFFICE OF THE DISTRICT OF COLUMBIA WAS FULLY JUSTIFIED IN DETERMINING WHAT THE DELIVERED COST OF THE BULK QUANTITIES OF ROCK SALT WOULD BE IF THE SHIPMENTS ORIGINATING AT MORTON, OHIO, WERE ROUTED TO AND ACCEPTED AT WASHINGTON, D.C., INSTEAD OF TO BALTIMORE AND THEN DELIVERED BY MOTOR CARRIER TO WASHINGTON. WE ARE ALSO OF THE OPINION THAT THE MARGOLIS SALT COMPANY REASONABLY COULD NOT HAVE OBJECTED TO THE PROPOSED CHANGE IN EFFECTING DELIVERY TO WASHINGTON, SINCE ITS CONTEMPLATED NET RECOVERY OF $9.35 PER TON, LESS THE COST OF RAILROAD TRANSPORTATION FROM THE MINE TO BALTIMORE, WOULD BE THE SAME IF THE DISTRICT PAID THE FREIGHT DIFFERENTIALS INVOLVED.

THE SITUATION CONCERNING THE AWARD MADE TO THE MARGOLIS SALT COMPANY FOR ITEM 2A OF THE INVITATION FOR BIDS IS UNUSUAL BUT, IN THE PARTICULAR CIRCUMSTANCES, WE FIND NO SUBSTANTIAL BASIS FOR CONCLUDING THAT THE ACTION TAKEN BY THE DISTRICT WAS UNFAIR TO ANY OTHER BIDDER. ACCORDINGLY, YOUR PROTEST TO THIS OFFICE IN THE MATTER IS HEREBY DENIED.