B-153765, APR. 7, 1964

B-153765: Apr 7, 1964

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

INCORPORATED: REFERENCE IS MADE TO YOUR TELEGRAM OF MARCH 20. IT IS STATED THAT ON MARCH 16. WAS ADVISED THAT BETWEEN 48 AND 72 HOURS WOULD BE REQUIRED FOR AN APPROPRIATE FINANCIAL INVESTIGATION TO BE CONDUCTED BEFORE THE BOND COULD BE ISSUED. FURTHER THAT THE INVESTIGATION COULD NOT BE INITIATED UNTIL THE INSURANCE COMPANY WAS PROVIDED WITH THE FINAL BID PRICE. THAT THE FINAL BID PRICE WAS NOT DETERMINED UNTIL MARCH 18. IT IS ALSO STATED THAT YOU NOW HAVE IN YOUR POSSESSION YOUR BID GUARANTEE. IT IS FURTHER CONTENDED THAT THE STATEMENT . FAILURE TO FURNISH BID GUARANTEE WITH THE BID SUBMITTED WILL BE SUFFICIENT REASON FOR REJECTION OF BID AS NON-RESPONSIVE" CLEARLY INDICATES THAT A NONRESPONSIVE DETERMINATION RESULTING FROM FAILURE TO FURNISH A BID GUARANTEE IS NOT MANDATORY.

B-153765, APR. 7, 1964

TO PARADYNAMICS, INCORPORATED:

REFERENCE IS MADE TO YOUR TELEGRAM OF MARCH 20, 1964, AND YOUR CONFIRMING LETTER OF THE SAME DATE, PROTESTING THE REJECTION OF YOUR BID AS NONRESPONSIVE FOR FAILURE TO PROVIDE A BID GUARANTEE (BOND) AS SPECIFIED IN INVITATION FOR BIDS NO. CG-02, 799-A, ISSUED BY THE COMMANDANT, UNITED STATES COAST GUARD (FS-1), OPENED MARCH 19, 1964.

IT IS STATED THAT ON MARCH 16, 1964, PARADYNAMICS APPLIED TO ITS INSURANCE BROKERS FOR A BID BOND, BUT WAS ADVISED THAT BETWEEN 48 AND 72 HOURS WOULD BE REQUIRED FOR AN APPROPRIATE FINANCIAL INVESTIGATION TO BE CONDUCTED BEFORE THE BOND COULD BE ISSUED, AND FURTHER THAT THE INVESTIGATION COULD NOT BE INITIATED UNTIL THE INSURANCE COMPANY WAS PROVIDED WITH THE FINAL BID PRICE; THAT THE FINAL BID PRICE WAS NOT DETERMINED UNTIL MARCH 18, 1964, TOO LATE FOR ISSUANCE OF THE BOND PRIOR TO THE BID OPENING TIME OF 2 P.M., MARCH 19, 1964. IT IS ALSO STATED THAT YOU NOW HAVE IN YOUR POSSESSION YOUR BID GUARANTEE.

YOU FURTHER STATE THAT PARADYNAMICS, AND ITS CONTROL ELECTRONICS DIVISION, FOR MANY YEARS HAS DEMONSTRATED ITS CAPABILITY TO PERFORM GOVERNMENT CONTRACTS AWARDED BY THE U.S. COAST GUARD, AND HAS NEVER BEEN CONSIDERED AN IRRESPONSIBLE BIDDER. IT IS FURTHER CONTENDED THAT THE STATEMENT ,FAILURE TO FURNISH BID GUARANTEE WITH THE BID SUBMITTED WILL BE SUFFICIENT REASON FOR REJECTION OF BID AS NON-RESPONSIVE" CLEARLY INDICATES THAT A NONRESPONSIVE DETERMINATION RESULTING FROM FAILURE TO FURNISH A BID GUARANTEE IS NOT MANDATORY, BUT DISCRETIONARY WITH THE CONTRACTING OFFICER.

THE GENERAL SERVICES ADMINISTRATION, PURSUANT TO SECTION 205 (C) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT, AS AMENDED, 40 U.S.C. 486 (C), PROMULGATED SECTION 1-10.102-5 OF THE FEDERAL PROCUREMENT REGULATIONS READING IN PERTINENT PART AS FOLLOWS:

"WHERE AN INVITATION FOR BIDS REQUIRES THAT BID BE SUPPORTED BY A BID GUARANTEE, NONCOMPLIANCE WITH SUCH REQUIREMENT WILL REQUIRE REJECTION OF THE BID. * * *"

THE ACTION OF THE CONTRACTING OFFICER IN THE PRESENT MATTER AS REPORTED IN YOUR LETTER APPEARS TO FALL SQUARELY WITHIN THE LANGUAGE OF THE PROVISION. THESE REGULATIONS ISSUED PURSUANT TO STATUTORY AUTHORITY HAVE THE FORCE AND EFFECT OF A STATUTE, AND THE INVITATION PROVISION CANNOT BE CONSTRUED IN DEROGATION OF THE REGULATIONS.

WE HAVE HERETOFORE CONSTRUED THE PROVISION AS NOT BEING SUBJECT TO WAIVER, EXCEPT UNDER CERTAIN CIRCUMSTANCES LISTED IN THE REGULATIONS BUT NOT PERTINENT HERE. SEE 38 COMP. GEN. 532; 39 COMP. GEN. 827; B 140624, NOVEMBER 23, 1959.

IN VIEW OF THE PRECEDENTS THUS ESTABLISHED AND THE REASONS THEREFOR, AND SINCE UNDER THE PROCUREMENT LAWS ALL BIDDERS MUST BE REQUIRED TO COMPETE ON AN EQUAL BASIS, WE HAVE NO ALTERNATIVE BUT TO CONCLUDE THAT THE REJECTION OF THE BID OF YOUR COMPANY FOR NONRESPONSIVENESS WAS LEGALLY REQUIRED.