B-159239, AUG. 2, 1966

B-159239, AUG. 2, 1966

TO RALPH W. BREWSTER:

FURTHER REFERENCE IS MADE TO YOUR PROTEST AGAINST AWARD OF A CONTRACT TO MARVIN C. GOLD BY THE POST OFFICE DEPARTMENT FOR THE CONSTRUCTION AND LEASE OF A POST OFFICE AT PITTSFIELD, NEW HAMPSHIRE, WHICH WAS THE SUBJECT OF YOUR LETTERS OF MAY 18 AND JULY 11, 1966, TO OUR OFFICE. THE ADMINISTRATIVE REPORT FURNISHED IN REPLY TO YOUR PROTEST ALSO INCLUDES COPIES OF OTHER CORRESPONDENCE CONCERNING YOUR PROTEST WHICH HAS BEEN CONSIDERED IN REACHING OUR DECISION HEREIN.

BASICALLY, YOUR PROTEST IS TO THE EFFECT THAT THE GOLD PROPERTY DID NOT MEET THE REQUIREMENTS OF THE DEPARTMENT'S DRAWING NO. BOS-1, ENGINEERING JOB NO. 1532, DATED DECEMBER 21, 1965, FOR THE PROPOSED POST OFFICE, AND THAT THOSE REQUIREMENTS WERE ILLEGALLY REDUCED TO FAVOR GOLD CONTRARY TO PUBLIC BID PROCEDURES. IN THIS CONNECTION, YOU POINT OUT THAT UNDER THE HEADING "PROJECT CATEGORY" ITEM 2 IS CHECKED AFFIRMATIVELY AND PROVIDES THAT:

"THE SPECIFIC REQUIREMENTS INDICATED HEREON ARE APPLICABLE TO PROPOSED NEW/BUILDING CONSTRUCTION AND SHALL BE PROVIDED BY THE LESSOR AS PART OF THE LEASE AGREEMENT. IN CASES WHERE THE USE OF AN EXISTING BUILDING IS PROPOSED SUBJECT TO DEMOLITION AND IMPROVEMENT, THE SAME REQUIREMENTS SHOULD BE FOLLOWED TO THE FULLEST FEASIBLE EXTENT, AND ANY DEVIATIONS THEREFROM MUST BE FULLY STATED IN THE PROPOSAL.'

IT IS ALSO YOUR CONTENTION THAT SINCE YOUR PROPERTY MET ALL OF THE REQUIREMENTS AND YOUR RENTAL OFFER WAS FAIR, THE DEPARTMENT WAS REQUIRED TO ACCEPT YOUR BID. OTHER POINTS YOU MAKE ARE THAT THE SPECIFICATIONS CALL FOR A TOTAL AREA OF OVER 17,000 SQUARE FEET, WHICH YOUR PROPERTY EXCEEDS, AND THE GOLD PROPERTY IS LESS THAN 10,000 SQUARE FEET; THAT YOU WERE REQUIRED TO FURNISH A CONTOUR SURVEY MAP AT AN EXPENSE OF $250, WHEREAS GOLD WAS NOT SO REQUIRED; THAT THE SITE YOU OFFERED IS MORE STRATEGICALLY LOCATED THAN THE GOLD SITE; AND THAT CONSTRUCTION ON THE GOLD SITE WILL REQUIRE DESTRUCTION OF A VALUABLE BUILDING TO THE COMMUNITY, WHEREAS THE BUILDING WHICH MUST BE REMOVED FROM YOUR SITE IS MUCH LESS OF AN ASSET TO THE COMMUNITY.

ON JANUARY 27, 1966, THE ADVERTISEMENT FOR BIDS FOR SPACE WAS ISSUED PURSUANT TO THE AUTHORITY OF 39 U.S.C. 2102, WHICH PROVIDES THAT:

"/A) NOTWITHSTANDING ANY OTHER PROVISION OF LAW THE POSTMASTER GENERAL MAY LEASE, ON SUCH TERMS AS HE DEEMS APPROPRIATE, REAL PROPERTY NECESSARY IN THE CONDUCT OF THE AFFAIRS OF THE DEPARTMENT.'

THE ADVERTISEMENT REQUESTED BIDS ON SPACE LOCATED IN THE CENTRAL BUSINESS DISTRICT AND ADVISED THAT THE "FOLLOWING APPROXIMATE SPACE AND AREAS ARE REQUIRED.'

CHART

ENCLOSED NET SPACE 2,577 SQ. FT.

DRIVEWAY, PARKING AND MANEUVERING 9,012

SQ. FT.

PLATFORM 264 SQ. FT.

SIDEWALKS 517 SQ. FT.

THE RENTAL WAS TO BE SPECIFIED FOR A BASE TERM OF TEN YEARS PLUS FOUR CONSECUTIVE FIVE-YEAR OPTIONS. THE ADVERTISEMENT ALSO INCLUDED THE FOLLOWING PROVISION:

"6. ANY AWARD MADE UNDER THIS ADVERTISEMENT WILL BE MADE TO THAT RESPONSIBLE BIDDER WHOSE BID IS MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED. IMPORTANT FACTORS INCLUDE BUT ARE NOT LIMITED TO LOCATION, GOOD DAYLIGHT AND VENTILATION, ACCESSIBILITY FOR PATRONS, ACCESSIBILITY TO MAIL LOADING AREAS FOR POSTAL VEHICLES, SERVICE CONSIDERATIONS, AND OVERALL OPERATING COSTS. THE POST OFFICE DEPARTMENT RESERVES THE RIGHT TO NEGOTIATE WITH BIDDERS FOR BETTER TERMS, CLARIFICATION OF AMBIGUITIES, MODIFICATION, OR OTHER CHANGES; TO SECURE OFFERS ON SUITABLE PROPERTIES, IN ADDITION TO THOSE SUBMITTED IN RESPONSE TO THE ADVERTISEMENT; AND/OR TO REJECT ANY AND ALL BIDS.'

THE BIDS RECEIVED, AS AMENDED, WERE AS FOLLOWS:

* * * * * * * * * * * * * * (TABLE OMITTED) * * * * * * * * * * * * * *

THE ADMINISTRATIVE REPORT FURNISHED IN THIS CASE INDICATES THAT AWARD OF THE CONTRACT TO GOLD ON MAY 4, 1966, WAS MADE ONLY AFTER CAREFUL STUDY AND CONSIDERATION OF BOTH OFFERS BY ALL INTERESTED UNITS OF THE BOSTON REGIONAL OFFICE. THEIR CONSIDERATION INCLUDED A BID ANALYSIS PREPARED BY THE REGIONAL REAL ESTATE OFFICER. BOTH ECONOMIC AND LOCATION FACTORS, AS WELL AS OTHER FACTORS, WERE CONSIDERED IN THIS ANALYSIS. BASED ON BOTH COST AND INCOME ANALYSIS AND ON COMPARABLE RENTAL DATA IT WAS DETERMINED THAT RENTAL RATE OFFERED BY GOLD REPRESENTED THE FAIR MARKET VALUE. THE SAME ANALYSIS IT WAS DETERMINED THAT YOUR RENTAL RATE WAS ABOVE THE FAIR MARKET VALUE. WITH RESPECT TO THE LOCATION OFFERED BY EACH BIDDER, THE FOLLOWING CONCLUSION WAS REACHED:

"THE COMMUNITY OF PITTSFIELD HAS AN UNUSUAL SITUATION IN THAT THERE ARE TWO AREAS OF THE CENTRAL BUSINESS DISTRICT WHICH ARE CONNECTED BY A RESIDENTIAL STREET. SITE NO. 1 (BREWSTER) IS LOCATED IN THE CENTER OF ONE OF THESE DISTRICTS. SITE NO. 2 (GOLD) IS LOCATED ABOUT HALF WAY BETWEEN THE TWO DISTRICTS. IT IS BELIEVED THAT THE LOCATION OF EITHER SITE WOULD PROVE SATISFACTORY TO A MAJORITY OF OUR PATRONS. SITE NO. 2 IS LOCATED ABOUT 600 FT. FROM OUR PRESENT QUARTERS AND SITE NO. 1 IS LOCATED ABOUT THE SAME DISTANCE BEYOND SITE NO. 2.

"EACH SITE CONTAINS ADEQUATE AREA TO MEET SERVICE NEEDS AND FOR ON SITE PATRON PARKING. THE RESIDENTIAL BUILDING ON SITE NO. 2 PRESENTS A MUCH BETTER APPEARANCE THAN THE BUILDINGS ON SITE NO. 1. THEREFORE, IT IS PROBABLE THAT A MAJORITY OF THE PEOPLE WOULD PREFER TO SEE THE BUILDING ON SITE NO. 1 DEMOLISHED. HOWEVER, IT IS BELIEVED THAT THE DEMOLITION OF THE BUILDING ON SITE NO. 2 WILL NOT CAUSE APPRECIABLE ADVERSE REACTION.'

SINCE THE SITES OFFERED BY BOTH BIDDERS WERE EQUALLY ACCEPTABLE AND THE RENTAL OFFERED BY GOLD WOULD RESULT IN A CONSIDERABLE SAVINGS TO THE GOVERNMENT, THE DECISION WAS MADE TO AWARD THE CONTRACT TO GOLD.

IT SHOULD BE NOTED THAT ALTHOUGH YOU HAVE STATED THAT THE GOLD PROPERTY IS LESS THAN 10,000 SQUARE FEET IN AREA, THE ADMINISTRATIVE REPORT STATES THAT IT EXCEEDS 13,750 SQUARE FEET; ADAPTS ITSELF PARTICULARLY WELL TO THE INTENDED USE; PROVIDES A MANEUVERING AREA WITH SEVENTY FEET IN FRONT OF THE PLATFORM; AND HAS EIGHT SPACES FOR PATRON PARKING WITH SUFFICIENT ROOM FOR FURTHER EXPANSION. IT IS ALSO REPORTED THAT YOU WERE REQUIRED TO FURNISH A CONTOUR MAP IN ORDER TO DETERMINE IF YOUR LOT CONTAINED SUFFICIENT AREA BECAUSE IT APPEARED TO HAVE SERIOUS ELEVATION PROBLEMS.

IF THIS PROJECT HAD BEEN ADVERTISED FOR ACQUISITION PURSUANT TO 39 U.S.C. 2103 (A) AS IMPLEMENTED BY 39 U.S.C. 2112 (2) REQUIRING CONSUMMATION OF LEASE AGREEMENTS IN ACCORDANCE WITH THE ADVERTISING REQUIREMENTS OF 41 U.S.C. 5, AWARD COULD HAVE BEEN MADE ONLY TO A RESPONSIBLE BIDDER SUBMITTING THE LOWEST BID IN ACCORDANCE WITH THE ADVERTISED SPECIFICATIONS. ALTHOUGH IT DOES NOT APPEAR THAT EXACT COMPLIANCE WITH THE NUMBER OF SQUARE FEET SPECIFIED FOR THE VARIOUS AREAS SET FORTH IN THE PROJECT DRAWING WAS CONTEMPLATED OR WOULD HAVE BEEN REQUIRED EVEN UNDER SUCH CIRCUMSTANCES, BECAUSE OF THE USE OF THE WORD "APPROXIMATE" IN REFERRING TO SPACE AND AREA REQUIREMENTS IN THE ADVERTISEMENT, YOUR CONTENTION THAT THE GOLD BID WAS NONRESPONSIVE AND SHOULD HAVE BEEN REJECTED WOULD HAVE BETTER APPLICATION TO THOSE STATUTORY PROVISIONS. HOWEVER, AS INDICATED ABOVE, THE ADVERTISEMENT FOR BIDS WAS MADE UNDER A DIFFERENT AND BROADER AUTHORITY, 39 U.S.C. 2102, AND THE BIDDERS WERE CLEARLY ADVISED THAT THE DEPARTMENT RESERVED THE RIGHT TO NEGOTIATE FURTHER WITH BIDDERS FOR BETTER TERMS, TO REJECT ANY OR ALL BIDS, TO NEGOTIATE WITH BIDDERS FOR CLARIFICATION OF AMBIGUITIES OR OTHER DESIRABLE MODIFICATIONS IN THEIR PROPOSALS, AND TO EVEN SECURE OFFERS ON SUITABLE PROPERTIES IN ADDITION TO THOSE SUBMITTED IN RESPONSE TO THE ADVERTISEMENT.

WE HAVE HELD THAT STATUTES GRANTING AUTHORITY TO NEGOTIATE CONTRACTS WITHOUT ADVERTISING, SUCH AS 39 U.S.C. 2102, COMPREHEND THE LESSER AUTHORITY TO UTILIZE ADVERTISING TO THE EXTENT ADMINISTRATIVELY DEEMED APPROPRIATE IN MAKING CONTRACTS THEREUNDER, WITHOUT RESTRICTING FINAL ADMINISTRATIVE DETERMINATION OF THE BIDDER TO WHOM THE CONTRACT SHOULD BE AWARDED. 20 COMP. GEN. 194. THE SOLICITATION OF BIDS UNDER THE CIRCUMSTANCES HERE INVOLVED WITH THE EXPRESS RESERVATION OF THE RIGHT TO REJECT ANY OR ALL BIDS AND TO NEGOTIATE FURTHER WITH QUALIFIED BIDDERS CANNOT BE REGARDED AS IMPOSING ON THE DEPARTMENT ANY OBLIGATION TO ACCEPT ONLY THE BID OFFERING THE ,APPROXIMATE" SPACE AND AREA STATED, OR ANY OTHER OF THE BIDS RECEIVED. ON THE OTHER HAND, IN VIEW OF THE EXPRESS AUTHORITY GRANTED THE POSTMASTER GENERAL IN 39 U.S.C. 2102, WHICH PERMITS NEGOTIATION WITHOUT REGARD TO THE RULES OF FORMALLY ADVERTISED COMPETITIVE BIDDING, ANY AWARD THAT MIGHT BE MADE IN THIS INSTANCE WOULD BE A MATTER WITHIN THE DISCRETION OF THE POST OFFICE DEPARTMENT AND IN THE ABSENCE OF A SHOWING OF A FAILURE ON THE PART OF THE OFFICIALS OF THE DEPARTMENT TO EXERCISE THEIR BEST JUDGMENT IN MAKING AN AWARD, OUR OFFICE WOULD NOT BE JUSTIFIED IN OBJECTING TO SUCH AN AWARD.

SINCE WE ARE UNABLE TO CONCLUDE THAT THERE WAS AN ABUSE OF THE DISCRETION PERMITTED THE POST OFFICE OFFICIALS INVOLVED, THERE IS NO PROPER BASIS FOR ANY ACTION BY OUR OFFICE. IN VIEW THEREOF, YOUR PROTEST MUST BE AND IS DENIED.