B-159558, SEP. 21, 1966

B-159558: Sep 21, 1966

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INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JUNE 23. IT WILL BE CONSIDERED TO BE INCLUDED IN THE PRICE OF THE END ITEM. TWO BIDS WERE OPENED. SINCE NEITHER BID CONTAINED A PRICE FOR THE SAMPLE TESTS AND SINCE THERE WERE NO SPECIFIC INSTRUCTIONS IN THE IFB RELATIVE TO THESE ITEMS. THE CONTRACTING OFFICER DETERMINED THAT THE IFB WAS DEFECTIVE AND REQUIRED CANCELLATION IN ACCORDANCE WITH ASPR 2-404.1 (B) (IV). INASMUCH AS IT WAS DETERMINED THAT NO RESPONSIVE BIDS WERE RECEIVED AND SINCE THE REQUIREMENT BECAME URGENT. ALL SOURCES WHICH RESPONDED TO THE IFB WERE SOLICITED ON THE NEGOTIATED PROCUREMENT. SINCE MILLER OFFERED THE LOWEST OVERALL PRICE FOR THE ITEM WHICH IT IS CURRENTLY PRODUCING.

B-159558, SEP. 21, 1966

TO HENRY PRODUCTS CO., INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JUNE 23, 1966, WITH ENCLOSURE, PROTESTING THE CANCELLATION OF INVITATION FOR BIDS (IFB) NO. IFB 09-603-66-1205 AND THE SUBSEQUENT NEGOTIATION OF A CONTRACT BY THE WARNER ROBINS AIR FORCE BASE, GEORGIA, WITH R. A. MILLER INDUSTRIES, INC.

THE SUBJECT BID ISSUED ON APRIL 19, 1966, AND OPENED ON MAY 19, 1966, CALLED FOR BIDS ON INCREMENTAL QUANTITIES OF AIRCRAFT ANTENNA. THE IFB SET FORTH LINE ITEMS AND QUANTITIES WITH SUBITEMS FOR SAMPLE TESTS IN ACCORDANCE WITH MIL-A-25761 APPLICABLE TO EACH INCREMENT. IN ADDITION, THE IFB REFLECTED AN ITEM FOR FIRST ARTICLE TESTS AND DATA. THE PROVISIONS OF THE IFB REQUIRED BIDDERS TO INSERT PRICES FOR EACH INCREMENTAL QUANTITY, A PRICE FOR FIRST ARTICLE TESTS AND A PRICE FOR DATA. CLAUSE 26, PAGE 13, STATED THAT IF BIDDER DOES NOT INDICATE A PRICE FOR FIRST ARTICLE TESTS, IT WILL BE CONSIDERED TO BE INCLUDED IN THE PRICE OF THE END ITEM. CLAUSE 29 PERMITTED FIRST ARTICLE TESTS TO BE WAIVED AND SET FORTH THE CONDITIONS UNDER WHICH WAIVER WOULD BE GRANTED. PRODUCTION SAMPLE TESTS, HOWEVER, COULD NOT BE WAIVED IN THE SAME MANNER AS FIRST ARTICLE TESTS.

AT THE BID OPENING ON MAY 19, 1966, TWO BIDS WERE OPENED, ONE FROM YOUR COMPANY AND THE OTHER FROM R. A. MILLER INDUSTRIES, INC. NEITHER BID REFLECTED PRICES FOR PRODUCTION SAMPLE TESTS. YOUR COMPANY BID A UNIT PRICE OF $129.72 EACH FOR THE INITIAL QUANTITY OF 556 AND MILLER BID $47 EACH FOR THE SAME QUANTITY. SINCE NEITHER BID CONTAINED A PRICE FOR THE SAMPLE TESTS AND SINCE THERE WERE NO SPECIFIC INSTRUCTIONS IN THE IFB RELATIVE TO THESE ITEMS, THE CONTRACTING OFFICER DETERMINED THAT THE IFB WAS DEFECTIVE AND REQUIRED CANCELLATION IN ACCORDANCE WITH ASPR 2-404.1 (B) (IV).

INASMUCH AS IT WAS DETERMINED THAT NO RESPONSIVE BIDS WERE RECEIVED AND SINCE THE REQUIREMENT BECAME URGENT, THE CONTRACTING OFFICER RESORTED TO NEGOTIATION PROCEDURES UNDER THE AUTHORITY OF 10 U.S.C. 2304 (A) (2), "PUBLIC EXIGENCY.' ALL SOURCES WHICH RESPONDED TO THE IFB WERE SOLICITED ON THE NEGOTIATED PROCUREMENT; HOWEVER, YOUR COMPANY DID NOT SUBMIT A PROPOSAL. MILLER CONFIRMED ITS PRICE OF $47 EACH FOR THE ITEM PLUS $556 FOR SAMPLE TESTS. SINCE MILLER OFFERED THE LOWEST OVERALL PRICE FOR THE ITEM WHICH IT IS CURRENTLY PRODUCING, THEREBY ALLOWING WAIVER OF THE FIRST ARTICLE TESTING REQUIREMENT, AND SINCE INITIAL DELIVERY CAN BE OBTAINED APPROXIMATELY 75 DAYS EARLIER THAN FROM ANY OTHER OFFERORS, CONTRACT NO. F09603-67-C-0164 WAS AWARDED TO MILLER ON JULY 28, 1966, IN THE AMOUNT OF $26,688. IN THIS REGARD, THE DETERMINATION TO UTILIZE NEGOTIATION AUTHORITY, RATHER THAN FORMAL ADVERTISING PROCEDURES, WAS BASED ON PROPER FINDINGS WHICH ARE CONCLUSIVE ON OUR OFFICE. SEE 10 U.S.C. 2310 (B).

IN YOUR LETTER OF JUNE 23, 1966, YOU CONTEND THAT YOUR BID WAS RESPONSIVE AND SHOULD NOT HAVE BEEN REJECTED. YOU POINT OUT THAT SINCE THERE WAS NOTHING IN THE IFB WHICH REQUIRED SEPARATE PRICING FOR SAMPLE TESTS YOU INCLUDED SUCH COSTS IN YOUR END ITEM PRICES.

THE REQUIREMENT FOR SAMPLE TESTING WAS SET FORTH AS SEPARATE BID ITEMS IN THE INVITATION AND SPACES WERE PROVIDED FOR SEPARATE PRICING OF SUCH ITEMS. HOWEVER, PROVISION NO. 3 ON PAGE 5 OF THE INVITATION PROVIDED THAT BIDS WOULD BE EVALUATED ON THE BASIS OF "INITIAL AWARD - INCREMENT ,A" " ONLY OF EACH LINE ITEM. INASMUCH AS THE COST OF SAMPLE TESTING WAS A FACTOR OF COST TO THE GOVERNMENT WHICH SHOULD BE CONSIDERED IN EVALUATION OF BIDS AND SINCE THE INVITATION FAILED TO PROVIDE FOR CONSIDERATION OF THE CONTRACTING OFFICER THAT THE INVITATION WAS DEFECTIVE AND CANCELLATION WAS REQUIRED IN ACCORDANCE WITH ASPR 2-404.1 (B) (IV).

WHILE YOU ALLEGE THAT YOU INCLUDED IN THE PRICE OF THE END ITEM THE COSTS OF SAMPLE TESTING, THERE WAS NOTHING IN YOUR BID TO SUBSTANTIATE THAT FACT. CONSEQUENTLY, THE CONTRACTING OFFICER COULD NOT CONCLUSIVELY DETERMINE THAT THE END ITEM PRICE QUOTED BY YOU INCLUDED THE COSTS OF SAMPLE TESTING.

UNDER PARAGRAPH 8 OF THE BIDDING INSTRUCTIONS, TERMS, AND CONDITIONS, MADE A PART OF THE INVITATION, THE GOVERNMENT EXPRESSLY RESERVED THE RIGHT TO REJECT ANY AND ALL BIDS UNDER THE INVITATION. THIS WAS IN ACCORDANCE WITH THE PROVISIONS IN 10 U.S.C. 2305 (C) WHICH AUTHORIZE THE REJECTION OF ALL BIDS IF THE HEAD OF THE AGENCY DETERMINES SUCH ACTION TO BE IN THE PUBLIC INTEREST. IN CONSISTENTLY HAS BEEN HELD BY THE ACCOUNTING OFFICERS OF THE GOVERNMENT AND BY THE COURTS THAT THE QUESTION OF REJECTING ALL BIDS IS PRIMARILY A MATTER OF ADMINISTRATIVE DISCRETION. ALSO, IT HAS BEEN HELD THAT A REQUEST FOR BIDS DOES NOT IMPORT ANY OBLIGATION TO ACCEPT ANY OF THE BIDS RECEIVED. SEE 41 COMP. GEN. 709, 711.

IN VIEW OF THE FOREGOING, WE WOULD NOT BE JUSTIFIED IN OBJECTING TO THE ADMINISTRATIVE ACTIONS TAKEN IN THE MATTER.