B-155177, NOV. 18, 1964

B-155177: Nov 18, 1964

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TO THE HONORABLE POSTMASTER GENERAL: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 14. REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLEGED BY THE ROWEN AND BLAIR ELECTRIC COMPANY TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. 25 49100-4-021 IS BASED. ON THE BASIS OF SUCH QUOTATION PURCHASE ORDER NO. 25-49100-4-021 WAS PROCESSED ON OCTOBER 9. THE COMPANY ALSO STATED THAT WHILE THE CORRECT PRICE FOR THE JOB IS $614.30. WHICH IS $489.21. THE COMPANY SUBMITTED ITS ESTIMATE SHEETS WHICH INDICATE THAT THE COMPANY'S BID PRICE OF $289.50 FOR THE JOB WAS BASED ON FURNISHING AND INSTALLING 400 FEET OF NUMBER 10 T.W. WHERE ONLY ONE BID IS RECEIVED ON AN ITEM. - THERE IS NO BASIS FOR COMPARISON OF BIDS.

B-155177, NOV. 18, 1964

TO THE HONORABLE POSTMASTER GENERAL:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 14, 1964, FROM THE DEPUTY ASSISTANT POSTMASTER GENERAL, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLEGED BY THE ROWEN AND BLAIR ELECTRIC COMPANY TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. 25 49100-4-021 IS BASED.

IT APPEARS FROM THE RECORD THAT THE POSTMASTER AT KALAMAZOO, MICHIGAN, CONTACTED A REPRESENTATIVE OF THE ROWEN AND BLAIR ELECTRIC COMPANY FOR A QUOTATION ON CERTAIN ELECTRICAL WORK COVERING THE INSTALLATION OF NEW CONDUIT AND ELECTRICAL CIRCUITS FOR 12 ADDITIONAL ENGINE PREHEATER OUTLETS AT THE POST OFFICE PARKING LOT AND THAT THE COMPANY'S REPRESENTATIVE QUOTED A PRICE OF $289.50 FOR THE JOB. ON THE BASIS OF SUCH QUOTATION PURCHASE ORDER NO. 25-49100-4-021 WAS PROCESSED ON OCTOBER 9, 1963.

BY LETTER DATED NOVEMBER 1, 1963, THE ROWEN AND BLAIR ELECTRIC COMPANY ADVISED THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT IT HAD ERRONEOUSLY BASED ITS BID PRICE ON FURNISHING AND INSTALLING 400 FEET OF NUMBER 10 T.W. STRANDED WIRE INSTEAD OF 4,000 FEET OF WIRE AS REQUIRED BY THE SPECIFICATIONS. THE COMPANY STATED THAT THE OMITTED WIRE WOULD COST $108 AND THAT IT WOULD COST AN ADDITIONAL SUM OF $195 TO INSTALL SUCH WIRE. THE COMPANY ALSO STATED THAT WHILE THE CORRECT PRICE FOR THE JOB IS $614.30, IT WOULD BE WILLING TO PERFORM THE REQUIRED WORK AT ITS ACTUAL COST WITHOUT ANY MARKUP, WHICH IS $489.21. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY SUBMITTED ITS ESTIMATE SHEETS WHICH INDICATE THAT THE COMPANY'S BID PRICE OF $289.50 FOR THE JOB WAS BASED ON FURNISHING AND INSTALLING 400 FEET OF NUMBER 10 T.W. STRANDED WIRE.

ORDINARILY, WHERE ONLY ONE BID IS RECEIVED ON AN ITEM--- AS IN THE PRESENT CASE--- THERE IS NO BASIS FOR COMPARISON OF BIDS; HENCE, THERE IS NOTHING TO PLACE THE CONTRACTING OFFICER ON NOTICE OF THE PROBABILITY OF ERROR IN THE BID. SEE 17 COMP. GEN. 560; 26 ID. 415. HOWEVER, IN A MEMORANDUM DATED SEPTEMBER 24, 1964, IT IS STATED THAT THE POSTMASTER (CONTRACTING OFFICER) AT THE KALAMAZOO POST OFFICE HAD ESTIMATED THE COST OF INSTALLING THE PREHEATERS AS BEING BETWEEN $500 AND $600--- APPROXIMATELY TWICE THE AMOUNT OF THE COMPANY'S BID PRICE FOR THE JOB. VIEW OF THE SUBSTANTIAL DIFFERENCE BETWEEN THE COMPANY'S BID AND THE GOVERNMENT ESTIMATE, THE PROBABILITY OF ERROR WAS APPARENT AND IN THESE CIRCUMSTANCES THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING THE COMPANY TO VERIFY ITS BID.

THE RECORD INDICATES THAT THE COMPANY HAS COMPLETED THE WORK CALLED FOR BY THE CONTRACT BUT THAT IT HAS NOT RECEIVED PAYMENT FOR THE WORK PERFORMED. ACCORDINGLY, CONTRACT NO. 25-49100-4-021 MAY BE AMENDED TO INCREASE THE PRICE FOR THE PROJECT TO $489.21, AS ADMINISTRATIVELY RECOMMENDED, AND PAYMENT FOR THE WORK IS AUTHORIZED TO BE MADE ON THAT BASIS.

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