B-154525, AUGUST 20, 1964, 44 COMP. GEN. 91

B-154525, AUGUST 20, 1964, 44 COMP. GEN. 91

BIDS - LATE - MODIFICATION - AGENCY MISHANDLING THE GOVERNMENT'S DELAY IN IDENTIFYING AND ASSOCIATING A DISCOUNT OFFERED ON CUSTODIAL SERVICES, WHICH WAS RECEIVED 2 FULL DAYS IN ADVANCE OF BID OPENING FROM THE SECOND LOW BIDDER AND IF IT HAD BEEN CONSIDERED THE LOW BIDDER WOULD HAVE BEEN DISPLACED, REQUIRES THE CANCELLATION OF THE CONTRACT AWARDED TO THE BIDDER NO LONGER THE LOWEST RESPONSIBLE BIDDER AND AN AWARD ON THE BASIS OF INCLUDING THE DISCOUNT OFFER RECEIVED IN ADVANCE OF BID OPENING AS PART OF THE BID IN DETERMINING ENTITLEMENT TO THE AWARD, THE ADVERTISING STATUTES REQUIRING THE CONTRACTING OFFICER TO MAKE AN AWARD TO THE LOWEST RESPONSIBLE BIDDER BASED UPON ALL THE FACTS AND CIRCUMSTANCES INVOLVED.

TO THE SECRETARY OF THE AIR FORCE, AUGUST 20, 1964:

REFERENCE IS MADE TO A LETTER DATED JULY 28, 1964, WITH ENCLOSURE, FROM THE CHIEF, PROCUREMENT OPERATIONS DIVISION, DIRECTORATE, PROCUREMENT POLICY, DEPUTY CHIEF OF STAFF, SYSTEMS AND LOGISTICS, HEADQUARTERS UNITED STATES AIR FORCE, RELATIVE TO THE PROTESTS AFTER AWARD BY BILL'S JANITOR SERVICE AND BY NORTHERN CUSTODIAL ENGINEERING COMPANY. THE SUBJECT INVITATION FOR BIDS NO. 21-603-64-68 ISSUED ON APRIL 29, 1964, FOR SPECIFIED FISCAL YEAR 1965 CUSTODIAL SERVICES BY THE BASE PROCUREMENT OFFICE, 343D FIGHTER GROUP (AIR DEFENSE COMMAND), DULUTH, MINNESOTA.

THE RECORD INDICATES THAT THE BIDS WERE OPENED ON JUNE 3, 1964, AT 2 P.M., C.D.S.T., WITH BIDS BEING RECEIVED FROM SEVEN BIDDERS. THE APPARENT LOW BIDDER, BASED UPON THE INFORMATION AVAILABLE AT THAT TIME WAS NORTHERN CUSTODIAL ENGINEERING COMPANY, IN THE AMOUNT OF $41,938.80, WITH A DISCOUNT OF 1/2 PERCENT, 10 DAYS. THE APPARENT SECOND LOW BID WAS THAT SUBMITTED BY BILL'S JANITOR SERVICE, IN THE AMOUNT OF $43,267.44, WITH NO CASH DISCOUNT.

ON JUNE 4, 1964, THE DAY AFTER BID OPENING, A LETTER FROM BILL'S JANITOR SERVICE WAS TURNED OVER TO THE CONTRACTING OFFICER AS POSSIBLY BEARING ON THE SUBJECT INVITATION FOR BIDS. THE DATE STAMP ON THIS LETTER, DATED MAY 30, 1964, SHOWS THAT IT WAS RECEIVED BY THE PROCUREMENT OFFICE AT 1200 HOURS ON JUNE 1, 1964, 2 FULL DAYS BEFORE THE OPENING OF BIDS. AFTER QUESTIONING PERSONNEL AT THE BASE WHO RECEIVE AND MAKE DISTRIBUTION OF MAIL, IT WAS DEFINITELY ESTABLISHED THAT THE ENVELOPE DID NOT HAVE ANY MARKINGS THAT WOULD IDENTIFY THE LETTER AS PERTAINING TO THE INVITATION FOR BIDS AND, THEREFORE, WAS DESTROYED. THE LETTER WAS PUT INTO DISTRIBUTION TO THE PROCUREMENT BRANCH WHERE IT WAS HELD UNTIL JUNE 4 AS IT COULD NOT BE IDENTIFIED AS PERTAINING TO ANY INDIVIDUAL PROCUREMENT.

ACCORDING TO THE CONTRACTING OFFICER, HE HAD NOT SEEN OR KNOWN OF THE EXISTENCE OF THE LETTER UNTIL JUNE 4. WHEN THE LETTER WAS TURNED OVER TO HIM, HE NOTICED THE LETTERHEAD AS BEING FROM ,BILL'S JANITOR SERVICE" AND RECALLED THE BID OPENING THE DAY BEFORE, AND THOUGHT THERE WAS A POSSIBILITY THAT THE LETTER MIGHT REFER TO THE SUBJECT BID. HE REVIEWED THE ABSTRACT OF BIDS WHICH SHOWED THAT BILL'S JANITOR SERVICE WAS A BIDDER. THE LETTER IS AS FOLLOWS:

BILL'S JANITOR SERVICE

405 CENTER STREET - MADISON 13, WISCONSIN

ALPINE 5-7682

MAY 30, 1964 BASE PROCUREMENT OFFICER DULUTH, MINN. DEAR SIR:

I AM GIVING 4 PERCENT TEN DAYS DISCOUNT.

THANK YOU MUCH

(S) BILL POWELL

BILL POWELL

THE CONTRACT WAS AWARDED TO NORTHERN CUSTODIAL ENGINEERING COMPANY ON JUNE 8, 1964. ON THE BASIS THAT THE LETTER MODIFYING THE PROTESTANT'S BID SHOULD HAVE BEEN CONSIDERED EITHER AT THE TIME OF BID OPENING OR AT ANY TIME THEREAFTER PRIOR TO AWARD OF THE CONTRACT, ITS 4 PERCENT DISCOUNT WOULD HAVE RESULTED IN A DECREASE IN ITS BID OF $1,730.70, THEREBY MAKING IT LOW BIDDER BY ABOUT $402.

YOUR OFFICE DETERMINED ON OR ABOUT JULY 8, 1964, THAT THE PROTEST OF BILL'S JANITOR SERVICE HAD MERIT AND THAT AWARD OF A CONTRACT TO NORTHERN CUSTODIAL WAS ILLEGAL AND IMPROPER. THEREAFTER, INSTRUCTIONS WERE ISSUED TO PLACE A HOLD ON ANY PERFORMANCE UNDER THE PURPORTED CONTRACT WITH NORTHERN CUSTODIAL ENGINEERING COMPANY, PENDING A FACILITIES CAPABILITY REPORT (FCR) ON BILL'S JANITOR SERVICE. ON JULY 16, 1964, NORTHERN CUSTODIAL LODGED A PROTEST WITH THE BASE PROCUREMENT OFFICER, OBJECTING TO ANY PROPOSED CANCELLATION OF AWARD. AN AFFIRMATIVE FOR ON BILL'S JANITOR SERVICE WAS RECEIVED ON JULY 21, 1964.

THE SOLE QUESTION FOR DETERMINATION IN THIS CASE IS WHETHER THE LETTER OF MAY 30 FROM BILL'S JANITOR SERVICE, WHICH WAS RECEIVED BY THE BASE PROCUREMENT OFFICE 2 FULL DAYS IN ADVANCE OF BID OPENING IS PROPERLY A PART OF ITS BID AND SHOULD HAVE BEEN CONSIDERED IN DETERMINING WHO WAS ENTITLED TO THE AWARD.

ARMED SERVICES PROCUREMENT REGULATION, PARAGRAPH 2-401 (B), PROVIDES:

(B)UNIDENTIFIED BIDS MAY BE OPENED SOLELY FOR THE PURPOSE OF IDENTIFICATION, AND THEN ONLY BY AN OFFICIAL SPECIFICALLY DESIGNATED FOR THIS PURPOSE BY THE HEAD OF THE PURCHASING ACTIVITY. IF A SEALED BID IS OPENED BY MISTAKE, THE PERSON WHO OPENS THE BID WILL IMMEDIATELY WRITE HIS SIGNATURE AND POSITION ON THE ENVELOPE AND DELIVER IT TO THE AFORESAID OFFICIAL. THIS OFFICIAL SHALL IMMEDIATELY WRITE ON THE ENVELOPE AN EXPLANATION OF THE OPENING, THE DATE AND TIME OPENED, THE INVITATION FOR BIDS NUMBER, AND HIS SIGNATURE, AND SHALL THEN IMMEDIATELY RESEAL THE ENVELOPE.

THE RECORD SHOWS THAT THE SUBJECT INVITATION FOR BIDS WAS THE ONLY JANITORIAL SERVICES PROCUREMENT OUT FOR BIDS AT THE AIR FORCE BASE DURING THE PERIOD IN QUESTION, AND WAS THE ONLY INVITATION FOR BIDS ISSUED BY THAT BASE ON WHICH BILL'S JANITOR SERVICE HAD EVER REQUESTED AN OPPORTUNITY TO BID. THE RECORD ALSO SHOWS THAT THE SUBJECT LETTER WAS ADDRESSED TO THE BASE PROCUREMENT OFFICER. IT IS OUR VIEW THAT THE PERSON WHO OPENED THE LETTER SHOULD HAVE REFERRED IT TO THE PROCUREMENT OFFICER PROMPTLY. UNDOUBTEDLY, THIS OFFICER AFTER READING THE LETTERHEAD WOULD BE SUFFICIENTLY COGNIZANT OF THE FACT THAT AT THIS TIME THERE WAS ONLY ONE JANITORIAL SERVICES PROCUREMENT OUT FOR BIDS, AND WOULD HAVE TRIED TO RELATE THE LETTER TO A PRIOR SUBMITTED BID. IF THERE WERE ANY DOUBTS IN THE MATTER MR. POWELL COULD HAVE BEEN CONTACTED FOR CONFIRMATION BEFORE BID OPENING.

AS STATED, HOWEVER, BY THE CHIEF, PROCUREMENT OPERATIONS DIVISION, AFTER BID OPENING IT WOULD NOT HAVE BEEN PROPER TO REQUEST A CLARIFICATION OF THE DISCOUNT OFFER FROM MR. POWELL. WE AGREE THAT FROM THE EVIDENCE KNOWN TO THE CONTRACTING OFFICER AFTER THE BID OPENING AND PRIOR TO AWARD IT SHOULD HAVE BEEN OBVIOUS WITHOUT ANY JANITOR SERVICE AND WAS PROPER FOR CONSIDERATION IN EVALUATING ITS BID. ACCORDINGLY, WE ARE OF THE OPINION THAT AWARD OF THE CONTRACT PROPERLY SHOULD HAVE BEEN MADE TO BILL'S JANITOR SERVICE AS THE LOW RESPONSIBLE BIDDER.

REGARDING THE PROTEST OF NORTHERN CUSTODIAL ENGINEERING COMPANY, THE ADVERTISING STATUTES REQUIRE THAT THE CONTRACTING OFFICER SHALL MAKE AWARD OF A CONTRACT TO THE LOWEST RESPONSIBLE BIDDER. BASED UPON ALL THE FACTS AND CIRCUMSTANCES INVOLVED HEREIN, IT IS DETERMINED THAT NORTHERN CUSTODIAL IS NOT THE LOWEST RESPONSIBLE BIDDER, AND THE AWARD OF THE SUBJECT CONTRACT TO THAT COMPANY ON JUNE 8 SHOULD BE CANCELED, AND AWARD MADE TO BILL'S JANITOR SERVICE.