B-156224, APR. 21, 1965

B-156224: Apr 21, 1965

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INDUSTRIAL DISTRIBUTING COMPANY OF ILLINOIS: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 25. WAS FROM $0.82 TO $1.32 PER UNIT LESS THAN THE NEXT LOW BID. WAS $0.05 PER UNIT MORE THAN THE LOW BID. PROVIDES THAT "A BID SUBMITTED ON AN "ALL OR NONE" TYPE OF BID BASIS (OR ANY OTHER BASIS ON WHICH AWARD OF ONE ITEM IS PREDICATED UPON AWARD OF ANOTHER) WILL NOT BE CONSIDERED. UNLESS THE BID IS LOW ON EACH ITEM TO WHICH THE . ALL OR NONE" BID IS MADE APPLICABLE.'. THE CONTRACTING OFFICE CONCLUDED THAT YOUR COMPANY'S BID WAS PRECLUDED FROM CONSIDERATION UNDER THE PROVISIONS OF PARAGRAPH 27. PARAGRAPH 27 IS AN IMPLEMENTATION OF GENERAL SERVICES ADMINISTRATION PROCUREMENT REGULATIONS PUBLISHED IN 41 CFR 5-2.407-50 (B).

B-156224, APR. 21, 1965

TO MISS MARY JO GUILFOYLE, OFFICE MANAGER, INDUSTRIAL DISTRIBUTING COMPANY OF ILLINOIS:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 25, 1965, PROTESTING THE AWARD TO ANOTHER BIDDER OF ITEMS 1 AND 2 UNDER INVITATION FOR BIDS SFF- 14308-65, ISSUED BY THE FEDERAL SUPPLY SERVICE, GENERAL SERVICES ADMINISTRATION (GSA).

THE SUBJECT INVITATION SOLICITED BIDS FOR INDEFINITE QUANTITIES OF CERTAIN ITEMS DELIVERED TO DIFFERENT LOCATIONS. YOUR COMPANY BID ON ITEMS 1A THROUGH "K" AND 2A THROUGH "K.' THE $9.18 BID PER UNIT ON ITEM 1A THROUGH "K," RAIN GAUGES WITH MEASURING STICKS, WAS FROM $0.82 TO $1.32 PER UNIT LESS THAN THE NEXT LOW BID. THE $0.65 BID PER UNIT ON ITEM 2A THROUGH "K," MEASURING STICKS FOR USE WITH RAIN GAUGES, WAS $0.05 PER UNIT MORE THAN THE LOW BID. AFTER THE LAST BID ON ITEM 2, YOUR COMPANY ADDED THE CONDITION "ITEMS 1 AND 2 ALL OR NONE.'

PARAGRAPH 27 OF GSA FORM 1424, INCORPORATED INTO THE INVITATION, PROVIDES THAT "A BID SUBMITTED ON AN "ALL OR NONE" TYPE OF BID BASIS (OR ANY OTHER BASIS ON WHICH AWARD OF ONE ITEM IS PREDICATED UPON AWARD OF ANOTHER) WILL NOT BE CONSIDERED, UNLESS THE BID IS LOW ON EACH ITEM TO WHICH THE ,ALL OR NONE" BID IS MADE APPLICABLE.' SINCE YOUR COMPANY HAD NOT BID LOW ON ITEM 2, THE CONTRACTING OFFICE CONCLUDED THAT YOUR COMPANY'S BID WAS PRECLUDED FROM CONSIDERATION UNDER THE PROVISIONS OF PARAGRAPH 27.

PARAGRAPH 27 IS AN IMPLEMENTATION OF GENERAL SERVICES ADMINISTRATION PROCUREMENT REGULATIONS PUBLISHED IN 41 CFR 5-2.407-50 (B), WHICH STATES THAT IN THE EVALUATION OF BIDS FOR INDEFINITE QUANTITIES WHEN THE INVITATION DOES NOT PROVIDE FOR AGGREGATE AWARDS, BIDS SUBMITTED ON AN "ALL OR NONE" BASIS SHALL NOT BE CONSIDERED UNLESS THE BID IS LOW ON EACH ITEM TO WHICH THE "ALL OR NONE" OFFER APPLIES.

IN VIEW OF THE INVITATION PROVISION AND THE REGULATION, THE REJECTION OF YOUR COMPANY'S BID APPEARS TO HAVE BEEN PROPER. B 154531, JULY 24, 1964.

YOUR COMPANY HAS SUGGESTED THE POSSIBILITY OF READVERTISING THE PROCUREMENT IN VIEW OF THE SAVINGS THAT MIGHT FLOW FROM ADVERTISING ITEMS 1 AND 2 AS A SINGLE ITEM. HOWEVER, THE DETERMINATION TO ADVERTISE ITEMS TOGETHER OR SEPARATELY IS LARGELY AN ADMINISTRATIVE MATTER AND IN VIEW OF THE FACT THAT ITEM 1 ADVERTISED FOR MEASURING STICKS WITH RAIN GAUGES AS A SINGLE UNIT AND ITEM 2 ADVERTISED FOR MEASURING STICKS ALONE, THE LATTER APPARENTLY INTENDED AS A REPLACEMENT ARTICLE, THE DETERMINATION TO SET THE ITEMS UP SEPARATELY, AS WAS DONE IN THIS CASE, DOES NOT APPEAR TO HAVE BEEN IMPROPER. SETTING UP THE ITEMS THIS WAY PROVIDES THE GOVERNMENT WITH THE LOWEST PRICE ON EACH ITEM. THIS IS DESIRABLE FROM THE STANDPOINT THAT THE QUANTITIES STATED IN THE INVITATION ARE ESTIMATED QUANTITIES WHICH THE GOVERNMENT IS NOT OBLIGATED TO PURCHASE SO THAT WHILE AN "ALL OR NONE" BIDDER HIGH ON ONE ITEM AND LOW ON ANOTHER ITEM MIGHT BE THE THEORETICAL LOW AGGREGATE BIDDER, IF ORDERS ARE NOT PLACED UNDER THE 1 YEAR TERM CONTRACT FOR THE AMOUNTS ESTIMATED, A SITUATION COULD ARISE WHERE THE GOVERNMENT WOULD PAY MORE THAN IF AN AWARD HAD BEEN MADE ON AN ITEM-BY- ITEM BASIS.

IN VIEW OF THE FOREGOING, OUR OFFICE WILL INTERPOSE NO OBJECTION TO THE AWARD THAT HAS BEEN MADE.