B-156723, JUN. 21, 1965

B-156723: Jun 21, 1965

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INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 13. THE INVITATIONS WILL HEREINAFTER BE IDENTIFIED AS IFB NO. 70 AND IFB NO. 78. THREE BIDS WERE RECEIVED AND OPENED ON APRIL 7. 460 WAS SUBMITTED BY AMERICAN AMPLIFIER AND TELEVISION CORPORATION. 879.90 WAS SUBMITTED BY WASHINGTON SOUND. 439.40 WAS SUBMITTED BY YOUR FIRM. THE RECORD INDICATES THAT THE BIDS OF THE TWO LOWEST BIDDERS WERE REJECTED ON THE BASIS OF INFORMATION SUBMITTED BY THEM WHICH SHOWED THAT THE EQUIPMENT THE BIDDERS PROPOSED TO FURNISH DID NOT MEET THE COMPLEX TECHNICAL REQUIREMENTS OF THE SPECIFICATIONS. A LETTER OF ACCEPTANCE OF YOUR BID WAS MAILED TO YOUR FIRM. IT IS REPORTED THAT THE TWO LOWEST BIDDERS WERE NOTIFIED BY TELEPHONE OF THE REJECTION OF THEIR BIDS AND THAT EACH OF THE TWO BIDDERS IMMEDIATELY RESPONDED BY STATING THAT THE SPECIFICATIONS WERE UNDULY RESTRICTIVE AND REQUIRED THE INSTALLATION OF EQUIPMENT OVER AND ABOVE THAT REASONABLY REQUIRED FOR THE INTENDED USE AND THAT EQUIPMENT COULD BE FURNISHED BY THEM WHICH WOULD BE SATISFACTORY FOR THE INTENDED USE AND WOULD RESULT IN SUBSTANTIAL SAVINGS TO THE GOVERNMENT.

B-156723, JUN. 21, 1965

TO SHRADER SOUND, INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 13, 1965, WITH ENCLOSURES, PROTESTING AGAINST THE ACTION OF THE BUREAU OF ENGRAVING AND PRINTING, TREASURY DEPARTMENT, WASHINGTON, D.C., IN CANCELING INVITATION NO. BEP-70 AND READVERTISING THE GOVERNMENT'S NEEDS UNDER INVITATION NO. BEP-78. THE INVITATIONS WILL HEREINAFTER BE IDENTIFIED AS IFB NO. 70 AND IFB NO. 78.

THE ORIGINAL INVITATION, IFB NO. 70, REQUESTED BIDS FOR FURNISHING ALL LABOR, MATERIALS AND EQUIPMENT, AND PERFORMING ALL OPERATIONS IN CONNECTION WITH THE INSTALLATION OF A GUIDED TOUR SOUND SYSTEM FOR THE BUREAU OF ENGRAVING AND PRINTING TO BE IN ACCORDANCE WITH THE GOVERNMENT'S SPECIFICATIONS.

THREE BIDS WERE RECEIVED AND OPENED ON APRIL 7, 1965. THE LOWEST BID IN THE AMOUNT OF $26,460 WAS SUBMITTED BY AMERICAN AMPLIFIER AND TELEVISION CORPORATION; THE SECOND LOWEST BID IN THE AMOUNT OF $28,879.90 WAS SUBMITTED BY WASHINGTON SOUND, INC.; AND THE THIRD BID IN THE AMOUNT OF $32,439.40 WAS SUBMITTED BY YOUR FIRM.

THE RECORD INDICATES THAT THE BIDS OF THE TWO LOWEST BIDDERS WERE REJECTED ON THE BASIS OF INFORMATION SUBMITTED BY THEM WHICH SHOWED THAT THE EQUIPMENT THE BIDDERS PROPOSED TO FURNISH DID NOT MEET THE COMPLEX TECHNICAL REQUIREMENTS OF THE SPECIFICATIONS, WHICH THE BUREAU FELT AT THAT TIME MET ITS MINIMUM NEEDS. ON APRIL 12, 1965, A LETTER OF ACCEPTANCE OF YOUR BID WAS MAILED TO YOUR FIRM, SUBJECT TO THE SUBMISSION AND APPROVAL OF PERFORMANCE AND PAYMENT BONDS.

IT IS REPORTED THAT THE TWO LOWEST BIDDERS WERE NOTIFIED BY TELEPHONE OF THE REJECTION OF THEIR BIDS AND THAT EACH OF THE TWO BIDDERS IMMEDIATELY RESPONDED BY STATING THAT THE SPECIFICATIONS WERE UNDULY RESTRICTIVE AND REQUIRED THE INSTALLATION OF EQUIPMENT OVER AND ABOVE THAT REASONABLY REQUIRED FOR THE INTENDED USE AND THAT EQUIPMENT COULD BE FURNISHED BY THEM WHICH WOULD BE SATISFACTORY FOR THE INTENDED USE AND WOULD RESULT IN SUBSTANTIAL SAVINGS TO THE GOVERNMENT. IT IS REPORTED THAT TO ALLOW TIME TO EVALUATE THE VERBAL PROTESTS OF THESE TWO BIDDERS, THE BUREAU NOTIFIED YOUR FIRM BY TELEPHONE ON APRIL 13, 1965, TO DEFER UNTIL FURTHER NOTICE ACTION ON THE LETTER OF ACCEPTANCE, WHICH THE RECORD INDICATES YOU RECEIVED THE SAME DAY.

IT IS REPORTED THAT A FURTHER ADMINISTRATIVE AND TECHNICAL REVIEW OF THE ORIGINAL SPECIFICATIONS DEVELOPED THE FACT THAT CERTAIN TECHNICAL REQUIREMENTS COULD BE BROADENED AND RESULT IN SAVINGS OF APPROXIMATELY $8,000. IT WAS DETERMINED BY THE CONTRACTING OFFICE THAT THE SOUND EQUIPMENT REQUIRED BY THE ORIGINAL SPECIFICATIONS WAS IN EXCESS OF THE MINIMUM REQUIREMENTS OF THE GOVERNMENT AND THAT IN VIEW OF THE SUBSTANTIAL MONETARY SAVINGS THAT COULD BE REALIZED, THE CONTRACT SHOULD BE CANCELED AND THE ITEM READVERTISED UNDER LESS RESTRICTIVE SPECIFICATIONS.

BY LETTER DATED APRIL 15, 1965, THE CONTRACTING OFFICE ADVISED YOU THAT THE LETTER OF ACCEPTANCE DATED APRIL 12, 1965, SHOULD BE DISREGARDED BY YOUR FIRM AND THAT A NEW INVITATION FOR BIDS WOULD BE ISSUED. ON APRIL 20, 1965, A NEW INVITATION FOR BIDS, IFB NO. 78, WAS ISSUED REQUESTING BIDS ON A GUIDED TOUR SOUND SYSTEM WHICH WAS NOT AS COMPLEX AS THE ONE REQUITED UNDER THE ORIGINAL INVITATION FOR BIDS. THE NEW INVITATION BROADENED THE BASIS FOR COMPETITION BY SUCH CHANGES AS REDUCING THE REQUIRED MAXIMUM FREQUENCY RESPONSE AND INCREASING THE NUMBER OF MAKES OF REPRESENTATIVE SPEAKERS AND AMPLIFIERS. ALSO, REQUIREMENTS FOR AMPLIFIER CONTROLS WERE BROADENED BY PERMITTING CHOICE OF ALTERNATIVE METHODS. THE FOLLOWING THREE BIDS WERE RECEIVED:

TABLE

WASHINGTON SOUND, INC. $24,749.80

AMERICAN AMPLIFIER AND

TELEVISION CORP. 27,332.00

SHRADER SOUND, INC. 32,791.75

ALTERNATE NO. 1 30,152.55

ALTERNATE NO. 2 28,928.32

ON MAY 5, 1965, THE BID OF WASHINGTON SOUND, INC., WAS ACCEPTED.

IN YOUR LETTER OF MAY 13, 1965, YOU STATE---

"WE ARE PROTESTING THE CANCELLATION OF IFB BEP-70 FOR THE FOLLOWING REASONS:

"1. SHRADER SOUND SUBMITTED A BID IN GOOD FAITH BASED ON THE SPECIFICATIONS AND THE BUREAU OF PRINTING AND ENGRAVING ACCEPTED SAID BID BY THEIR LETTER OF APRIL 12, 1965. THE SUBSEQUENT AWARD UNDER IFB BEP-78 IS THEREFORE INVALID.

"2. THE CHANGES IN SPECIFICATIONS ON IFB BEP-78 WERE NOT SIGNIFICANT ENOUGH TO WARRANT READVERTISING. BY SO DOING, OUR BID PRICES WERE EXPOSED AND OUR COMPETITIVE POSITION PLACED IN JEOPARDY.'

WE DO NOT AGREE WITH YOUR CONTENTION THAT THE AWARD MADE UNDER THE READVERTISED INVITATION, IFB NO. 78, IS INVALID BECAUSE YOUR BID UNDER THE ORIGINAL INVITATION, IFB NO. 70, WAS ACCEPTED BY THE BUREAU OF ENGRAVING AND PRINTING. THE RECORD SHOWS THAT IT WAS THE OPINION OF THE BUREAU THAT THE SPECIFICATIONS AS CONTAINED IN THE ORIGINAL INVITATION WERE NECESSARY TO MEET ITS ACTUAL NEEDS. AFTER NOTICE OF AWARD TO YOU, HOWEVER, THE BUREAU DETERMINED THAT ITS MINIMUM NEEDS WERE OVERSTATED IN THE SPECIFICATIONS AND THAT THE INTEREST OF THE GOVERNMENT WOULD BEST BE SERVED BY CANCELING YOUR CONTRACT AND READVERTISING ITS REQUIREMENTS UNDER LESS STRINGENT SPECIFICATIONS. THE COURTS, AS WELL AS OUR OFFICE, HAVE HELD THAT WHEN THE PUBLIC INTEREST REQUIRES SUCH ACTION, A CONTRACTING OFFICER MAY GERMINATE A CONTRACT WHICH HE WAS AUTHORIZED TO MAKE. FURTHERMORE, THE DETERMINATION AS TO WHETHER THE PUBLIC INTEREST REQUIRES SUCH TERMINATION IS A MATTER FOR ADMINISTRATIVE DECISION AND DOES NOT REST WITH OUR OFFICE. SEE 18 COMP. GEN. 826; 29 COMP. GEN. 36. IN VIEW THEREOF AND SINCE THE CONTRACT AWARDED TO YOU WAS CANCELED WE SEE NO LEGAL BASIS FOR CONCLUDING THAT THE AWARD MADE TO WASHINGTON SOUND, INC. UNDER IFB NO. 78 WAS IMPROPER OR ILLEGAL. THEREFORE, WE FIND NO LEGAL OBJECTION TO THE ACTION TAKEN BY THE BUREAU OF ENGRAVING AND PRINTING.