B-155856, FEB. 8, 1965

B-155856: Feb 8, 1965

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INC.: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM DATED DECEMBER 28. TWO BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION. 892.20 WAS REQUIRED ON THE 20 PERCENT BID GUARANTEE BASIS. TCG-07484-A WAS AWARDED TO THIS COMPANY IN THE TOTAL AMOUNT OF $350. YOU PROTEST THE AWARD BECAUSE OF THE FACT THAT THE REQUIRED 20 PERCENT BID GUARANTEE WAS NOT FURNISHED BY BRUSH INSTRUMENTS. PROCUREMENTS BY THE UNITED STATES COAST GUARD ARE SUBJECT TO THE FEDERAL PROCUREMENT REGULATIONS. SECTION 1- 10.103-4 WHICH SETS FORTH THE BASIC RULE THAT WHEN THERE IS NONCOMPLIANCE WITH A BID GUARANTEE REQUIREMENT THE BID SHALL BE REJECTED. IS EQUAL TO OR GREATER THAN THE DIFFERENCE BETWEEN THE PRICE STATED IN THE BID AND THE PRICE STATED IN THE NEXT HIGHER ACCEPTABLE BID.'.

B-155856, FEB. 8, 1965

TO BECKMAN INSTRUMENTS, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM DATED DECEMBER 28, 1964, PROTESTING THE AWARD OF A CONTRACT TO BRUSH INSTRUMENTS UNDER UNITED STATES COAST GUARD INVITATION NO. CC-17-484-A.

THE ABOVE INVITATION SOLICITED BIDS FOR FURNISHING AN OSCILLOGRAPHIC RECORDING SYSTEM AND THE SPECIFIED COMPONENT PARTS IN ACCORDANCE WITH THE REQUIREMENTS OF PURCHASE DESCRIPTION EEE-20-65. THE INVITATION PROVIDED THAT "THE BID GUARANTEE SHALL BE EQUAL TO TWENTY PERCENT (20 PERCENT) OF BID, INCLUDING OPTIONAL ITEMS.' TWO BIDS WERE RECEIVED IN RESPONSE TO THE INVITATION, ONE FROM BRUSH INSTRUMENTS, CLEVELAND, OHIO, IN THE TOTAL AMOUNT OF $429,461 FOR THE MAXIMUM ITEMS THAT COULD BE AWARDED. YOUR CORPORATION SUBMITTED THE OTHER BID IN THE TOTAL AMOUNT OF $486,348 FOR SUCH MAXIMUM ITEMS. BRUSH INSTRUMENTS SUBMITTED A BID BOND IN THE AMOUNT OF $80,000--- $85,892.20 WAS REQUIRED ON THE 20 PERCENT BID GUARANTEE BASIS--- AND ON DECEMBER 29, 1964, CONTRACT NO. TCG-07484-A WAS AWARDED TO THIS COMPANY IN THE TOTAL AMOUNT OF $350,116. YOU PROTEST THE AWARD BECAUSE OF THE FACT THAT THE REQUIRED 20 PERCENT BID GUARANTEE WAS NOT FURNISHED BY BRUSH INSTRUMENTS.

HOWEVER, UNDER THE CIRCUMSTANCES, THE BID BOND DEFICIENCY DOES NOT COMPEL REJECTION OF THE BID IN THIS CASE. PROCUREMENTS BY THE UNITED STATES COAST GUARD ARE SUBJECT TO THE FEDERAL PROCUREMENT REGULATIONS, SECTION 1- 10.103-4 WHICH SETS FORTH THE BASIC RULE THAT WHEN THERE IS NONCOMPLIANCE WITH A BID GUARANTEE REQUIREMENT THE BID SHALL BE REJECTED. BUT, SECTION 1-10.103-4 (B), PROVIDES AN EXCEPTION TO THIS RULE AS FOLLOWS:

"WHERE THE AMOUNT OF THE BID GUARANTEE SUBMITTED, THOUGH LESS THAN THE AMOUNT REQUIRED BY THE INVITATION FOR BIDS, IS EQUAL TO OR GREATER THAN THE DIFFERENCE BETWEEN THE PRICE STATED IN THE BID AND THE PRICE STATED IN THE NEXT HIGHER ACCEPTABLE BID.'

SINCE THE AMOUNT OF THE BID BOND FURNISHED BY BRUSH INSTRUMENTS IN THIS CASE, $80,000, IS GREATER THAN THE DIFFERENCE BETWEEN THE AMOUNT OF THAT COMPANY'S LOW BID AND THE BID SUBMITTED BY YOU ON THE MAXIMUM ITEMS THAT COULD BE AWARDED--- $486,348 MINUS $429,461 EQUALS $56,887- - IT WAS NOT REQUIRED THAT THE LOW BID OF BRUSH INSTRUMENTS BE REJECTED BECAUSE OF THE DEFICIENCY IN THE AMOUNT OF THE COMPANY'S BID BOND. SEE 40 COMP. GEN. 561.

ACCORDINGLY, WE FIND NO LEGAL OBJECTION TO THE ACTION TAKEN BY THE UNITED STATES COAST GUARD IN AWARDING CONTRACT NO. TCG-07484-A TO BRUSH INSTRUMENTS AND YOUR PROTEST MUST BE DENIED.