B-159291, AUG. 2, 1966

B-159291: Aug 2, 1966

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SUSS: FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 26. THAT UNITED WAS NOT ELIGIBLE TO BID AS A SMALL BUSINESS CONCERN ON GOVERNMENT SERVICE CONTRACTS. WE ARE ADVISED THAT THE REQUEST FOR OFFERS NO. PROBABLY WOULD HAVE BEEN THE ONLY WAGE RATE APPLICABLE TO ANY CONTRACT AWARDED UNDER THE REQUEST FOR OFFERS. AN AWARD UNDER THE ABOVE INVITATION HAD NOT YET BEEN MADE BECAUSE OF THE PENDING PROTEST OF ADVANCE WHICH WAS STILL UNDER CONSIDERATION. IT IS REPORTED THAT THE GOVERNMENT DID NOT REVEAL THE PRICES OF THE FIVE OFFERS RECEIVED ON MARCH 21. IT WAS ADMINISTRATIVELY CONCLUDED THAT THE PERTINENT WAGE AND FRINGE BENEFITS DETERMINATION OF THE DEPARTMENT OF LABOR WOULD NOT HAVE BEEN APPLICABLE TO JANITORIAL AND CUSTODIAL WORK IN THE LAFAYETTE BUILDING UNTIL SOMETIME IN THE FALL OF 1967.

B-159291, AUG. 2, 1966

TO MR. FREDRIC T. SUSS:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 26, 1966, PROTESTING ON BEHALF OF THE ADVANCE BUILDING MAINTENANCE COMPANY AGAINST ANY AWARD OF A CONTRACT TO UNITED MAINTENANCE COMPANY, INC., UNDER SMALL BUSINESS-SET ASIDE INVITATION FOR BIDS NO. GS-03B-12367 (NEG), ON THE BASIS THAT THE SMALL BUSINESS ADMINISTRATION HAD DETERMINED ON JANUARY 20 AND MAY 21, 1966, THAT UNITED WAS NOT ELIGIBLE TO BID AS A SMALL BUSINESS CONCERN ON GOVERNMENT SERVICE CONTRACTS.

WE ARE ADVISED THAT THE REQUEST FOR OFFERS NO. GS-03B-12367 (NEG), ISSUED BY THE GENERAL SERVICES ADMINISTRATION ON MARCH 4, 1966, AND OPENED ON MARCH 21, 1966, FOR JANITORIAL SERVICES AT THE LAFAYETTE BUILDING, WASHINGTON, D.C., CONTAINED THE PROVISIONS PRESCRIBED BY THE SERVICE CONTRACT ACT OF 1965 (P.L. 89-286) AND FPR 1-12.904-1, BUT DID NOT INCLUDE A MINIMUM MONETARY WAGE AND FRINGE BENEFITS DETERMINATION OF THE SECRETARY OF LABOR SINCE NONE HAD BEEN ISSUED AT THAT TIME. HENCE, THE MINIMUM WAGE SPECIFIED BY SECTION 6 (A) (1) OF THE FAIR LABOR STANDARDS ACT OF 1938, AS AMENDED, 29 U.S.C. 206, PROBABLY WOULD HAVE BEEN THE ONLY WAGE RATE APPLICABLE TO ANY CONTRACT AWARDED UNDER THE REQUEST FOR OFFERS. ON JUNE 24, 1966, THE CONTRACTING OFFICER RECEIVED FROM THE WAGE AND HOUR AND PUBLIC CONTRACTS DIVISION, DEPARTMENT OF LABOR, AN APPLICABLE WAGE AND FRINGE BENEFITS DETERMINATION DATED JUNE 13, 1966. AT THAT TIME, AN AWARD UNDER THE ABOVE INVITATION HAD NOT YET BEEN MADE BECAUSE OF THE PENDING PROTEST OF ADVANCE WHICH WAS STILL UNDER CONSIDERATION. IN VIEW OF THESE CIRCUMSTANCES, THE CONTRACTING OFFICER REJECTED ALL OFFERS ON JULY 8, 1966.

IT IS REPORTED THAT THE GOVERNMENT DID NOT REVEAL THE PRICES OF THE FIVE OFFERS RECEIVED ON MARCH 21, 1966. BECAUSE OF THE PROTEST THEN UNDER CONSIDERATION, GSA FELT THAT IT WOULD BE UNLIKELY THAT A NEW CONTRACT COULD BE AWARDED AND A NEW CONTRACTOR BEGIN PERFORMANCE BEFORE JUNE 30, 1966--- THE END OF THE CURRENT CONTRACT YEAR, OR, IN FACT, UNTIL LATE AUGUST OR SEPTEMBER, 1966. THEREFORE, IT WAS ADMINISTRATIVELY CONCLUDED THAT THE PERTINENT WAGE AND FRINGE BENEFITS DETERMINATION OF THE DEPARTMENT OF LABOR WOULD NOT HAVE BEEN APPLICABLE TO JANITORIAL AND CUSTODIAL WORK IN THE LAFAYETTE BUILDING UNTIL SOMETIME IN THE FALL OF 1967. FOR THESE REASONS, IT WAS CONSIDERED MORE FEASIBLE FROM AN ADMINISTRATIVE STANDPOINT TO CANCEL THE MARCH 4, 1966, REQUEST FOR OFFERS AND TO ISSUE A NEW REQUEST FOR OFFERS ON JULY 14, 1966, INCORPORATING THE DEPARTMENT OF LABOR DETERMINATION OF JUNE 13, 1966, IN KEEPING WITH PERTINENT REGULATIONS AND THE CONGRESSIONAL INTENT IN ENACTING THE SERVICE CONTRACT ACT OF 1965. IT WAS FELT THAT SUCH ACTION WOULD FACILITATE ADMINISTRATION OF THE CONTRACT AND INSURE BETTER PERFORMANCE AND CONTRACTOR REGULATIONS. OPENING DATE WAS SCHEDULED FOR JULY 26, 1966.

IT IS RECOGNIZED THAT THE REJECTION OF ALL BIDS, WITHOUT ABANDONMENT OF THE PROPOSED PROCUREMENT, TENDS TO DISCOURAGE COMPETITION BECAUSE IT RESULTS GENERALLY IN MAKING ALL BIDS PUBLIC WITHOUT AWARD. AS WAS STATED BY THE COURT OF CLAIMS IN MASSMAN CONSTRUCTION COMPANY V. UNITED STATES, 102 CT.CL. 699, 719,"TO HAVE A SET OF BIDS DISCARDED AFTER THEY ARE OPENED AND EACH BIDDER HAS LEARNED HIS COMPETITOR'S PRICE IS A SERIOUS MATTER, AND IT SHOULD NOT BE PERMITTED EXCEPT FOR COGENT REASONS.'

HOWEVER, BECAUSE OF THE CIRCUMSTANCES INVOLVED AND ESPECIALLY THE FACT THAT BID PRICES WERE NOT REVEALED, WE DO NOT FEEL THAT THE CANCELLATION OF THE EARLIER REQUEST FOR PROPOSALS IS SUBJECT TO QUESTION. MOREOVER, THIS RIGHT TO REJECT ALL OFFERS WAS RESERVED TO THE GOVERNMENT IN THE REQUEST FOR OFFERS. CF. FPR 1-2.404-1/B). THE AUTHORITY TO REJECT ALL BIDS IS EXTREMELY BROAD, INVOLVING PRIMARILY A MATTER OF ADMINISTRATIVE JUDGMENT, AND WE WILL NOT UNDERTAKE TO QUESTION ITS EXERCISE HERE IN THE ABSENCE OF A CLEAR SHOWING OF ABUSE OF DISCRETION. ACCORDINGLY, AND SINCE THE BASIS OF YOUR PROTEST IS NOW ACADEMIC, WE MUST DENY YOUR PROTEST.