B-160051, NOVEMBER 22, 1966, 46 COMP. GEN. 434

B-160051: Nov 22, 1966

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THE OMISSION IS A MATERIAL DEVIATION WHICH DEPRIVING THE GOVERNMENT OF THE SUBSTANTIVE AND VALUABLE RIGHT TO INCREASE QUANTITIES JUSTIFIES BID REJECTION. NOTWITHSTANDING THE QUOTED BASIC QUANTITY PRICE COULD BE USED FOR ANY OPTION QUANTITY AWARDED AT THE TIME THE BASIC QUANTITY IS AWARDED. 1966: REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 12. 000 UNITS WHICH WERE BROKEN DOWN MOSTLY INTO INCREMENTS OF 100 LISTED AS ITEMS 1B THROUGH 1K. INITIAL EVALUATION AND CONTRACT AWARD WILL BE MADE ON THE BASIS OF THE TOTAL QUANTITY REQUIRED AT THAT TIME. EVALUATION WILL BE MADE ON THE BASE QUANTITY. FIVE BIDS WERE RECEIVED AND OPENED ON AUGUST 9. THE LOWEST BID ON THE BASIC QUANTITY IN THE AMOUNT OF $56.75 EACH WAS SUBMITTED BY E.

B-160051, NOVEMBER 22, 1966, 46 COMP. GEN. 434

BIDS - EVALUATION - OPTIONS - FAILURE TO BID ON ALL OPTION INCREMENTS THE FAILURE OF A BIDDER TO QUOTE A PRICE FOR AN OPTION INCREMENT UNDER AN INVITATION WARNING THAT BIDDERS MUST BID ON ALL ITEMS MAY NOT BE CLASSED AS A MISTAKE UNDER PARAGRAPH 2-406.3 OF THE ARMED SERVICES PROCUREMENT REGULATION, AND EVEN IF INADVERTENT, THE OMISSION IS A MATERIAL DEVIATION WHICH DEPRIVING THE GOVERNMENT OF THE SUBSTANTIVE AND VALUABLE RIGHT TO INCREASE QUANTITIES JUSTIFIES BID REJECTION, NOTWITHSTANDING THE QUOTED BASIC QUANTITY PRICE COULD BE USED FOR ANY OPTION QUANTITY AWARDED AT THE TIME THE BASIC QUANTITY IS AWARDED, AS THAT PRICE COULD NOT BE USED FOR OPTION QUANTITIES AWARDED AFTER DATE OF INITIAL AWARD.

TO THE MILTON MACHINE CORPORATION, NOVEMBER 22, 1966:

REFERENCE IS MADE TO YOUR LETTER OF SEPTEMBER 12, 1966, WITH ENCLOSURES, PROTESTING AGAINST THE ACTION OF THE DEPARTMENT OF THE ARMY, UNITED STATES ARMY MISSILE COMMAND, REDSTONE ARSENAL, ALABAMA, IN REJECTING YOUR BID SUBMITTED UNDER INVITATION FOR BIDS NO. DAAHO1 67 B 0010.

THE INVITATION REQUESTED BIDS FOR FURNISHING 1,008 UNITS OF AN ARTICLE DESCRIBED AS A METAL PARTS ASSEMBLY, ROCKET MOTOR M37A1. THE INVITATION ALSO REQUESTED OPTION PRICES FOR AN ADDITIONAL 1,000 UNITS WHICH WERE BROKEN DOWN MOSTLY INTO INCREMENTS OF 100 LISTED AS ITEMS 1B THROUGH 1K. THE INVITATION CONTAINED AN OPTION CLAUSE WHICH PROVIDED AS FOLLOWS:

THE GOVERNMENT MAY INCREASE THE QUANTITY OF ALL OR ANY ONE OF THE LINE ITEMS CALLED FOR HEREIN BY ALL OR ANY PART OF THE OPTION LINE ITEM QUANTITY OR QUANTITIES LISTED IN THE SCHEDULE, AND AT THE UNIT PRICES SPECIFIED, RESPECTIVELY, FOR THE SEVERAL OPTION QUANTITIES. THE BIDDER, IF HE SO DESIRES, MAY OFFER VARYING PRICES DEPENDENT UPON THE QUANTITY OR QUANTITIES ACTUALLY AWARDED WITHIN THE OPTION PERIOD STATED IN THE SCHEDULE. THE CONTRACTING OFFICER MAY EXERCISE ALL OR ANY PART OF THIS OPTION AT THE TIME OF AWARD OF THE BASIC QUANTITY OR AT ANY TIME WITHIN 180 DAYS AFTER RECEIPT OF NOTICE OF AWARD, BY GIVING WRITTEN NOTICE TO THE CONTRACTOR. DELIVERY OF THE LINE ITEMS ADDED BY THE EXERCISE OF THIS OPTION SHALL CONTINUE IMMEDIATELY AFTER AND AT THE SAME RATE AS DELIVERY OF LIKE ITEMS CALLED FOR UNDER THIS CONTRACT UNLESS OTHERWISE PROVIDED. PROVIDED, HOWEVER, THAT ANY EXERCISE OF ANY PORTION OF THE OPTION QUANTITY OR QUANTITIES AT ANY TIME AFTER AWARD OF THE BASE QUANTITY, SHALL EXTEND THE DELIVERY DATE OF SUCH OPTION QUANTITY BY THE NUMBER OF EXPIRED DAYS OF THE OPTION PERIOD UNLESS OTHERWISE PROVIDED.

INITIAL EVALUATION AND CONTRACT AWARD WILL BE MADE ON THE BASIS OF THE TOTAL QUANTITY REQUIRED AT THAT TIME, INCLUDING THE BASIC QUANTITY AND ANY OPTION QUANTITY OR QUANTITIES TO BE AWARDED. IF THE GOVERNMENT DOES NOT ELECT TO EXERCISE ANY OPTION QUANTITY AT THE TIME OF THE INITIAL AWARD, EVALUATION WILL BE MADE ON THE BASE QUANTITY. QUANTITIES OF LINE ITEMS AWARDED BY MORE THAN ONE EXERCISE OF THIS OPTION, WITHIN THE OPTION PERIOD STATED IN THE SCHEDULE, SHALL BE CUMULATIVE IN DETERMINING THE PRICE BRACKET OF THE TOTAL OPTION QUANTITY AWARDED. ANY BID RECEIVED WHICH DOES NOT INCLUDE A BID ON THE OPTION QUANTITY OR QUANTITIES SHALL BE REJECTED AS NONRESPONSIVE.

FIVE BIDS WERE RECEIVED AND OPENED ON AUGUST 9, 1966. THE LOWEST BID ON THE BASIC QUANTITY IN THE AMOUNT OF $56.75 EACH WAS SUBMITTED BY E. E. LAYNE ASSOCIATES, INC. THAT BID WAS REJECTED AS NONRESPONSIVE TO THE INVITATION BECAUSE IT FAILED TO QUOTE PRICES FOR THE OPTION QUANTITIES COVERED BY ITEMS 1B TO 1K, INCLUSIVE. THE NEXT LOWEST BID ON THE BASIC QUANTITY IN THE AMOUNT OF $56.84 EACH WAS SUBMITTED BY YOUR FIRM. HOWEVER, YOUR BID ALSO WAS REJECTED AS NONRESPONSIVE TO THE INVITATION BECAUSE IT DID NOT INCLUDE A PRICE FOR THE LAST OPTION INCREMENT, ITEM 1K, THE 901 TO 1,000 INCREMENT. THE INVITATION WAS CANCELED IN ACCORDANCE WITH ARMED SERVICES PROCUREMENT REGULATION (ASPR) 2-404.1 (B) (VI), WHICH PROVIDES FOR CANCELLATION AFTER OPENING OF BIDS AND PRIOR TO AWARD WHEN IT IS DETERMINED THAT ALL OTHERWISE ACCEPTABLE BIDS RECEIVED ARE AT UNREASONABLE PRICES.

YOU PROTEST THE ACTION OF THE CONTRACTING OFFICER IS REJECTING YOUR BID AS NONRESPONSIVE TO THE INVITATION FOR BIDS BECAUSE YOU HAD FAILED TO QUOTE UNDER THE OPTION QUANTITIES A PRICE FOR THE INCREMENT QUANTITY OF 901 TO 1,000 COVERED BY ITEM 1K. YOU INVITE OUR ATTENTION TO THE FACT THAT OPPOSITE THE OPTION PRICES QUOTED IN YOUR BID YOU INSERTED A STATEMENT TO THE EFFECT THAT ANY OPTION QUANTITY INCLUDED WITH THE AWARD OF THE BASIC QUANTITY WOULD BE PRICED THE SAME AS THE BASIC QUANTITY. YOU CONTEND THAT THE PRICE OFFERED BY THIS NOTE WAS THE ONLY SIGNIFICANT PRICE THAT COULD HAVE BEEN USED IN THE EVALUATION OF BIDS AND THAT THE INCREMENT PRICES WERE NOT RELATIVE BECAUSE THE OPTION QUANTITY TO BE PROCURED, IF ANY, WAS UNKNOWN AT THE TIME OF THE ANALYSIS OF BIDS. YOU ALSO CONTEND THAT THE FAILURE TO QUOTE UNDER THE OPTION QUANTITIES A PRICE FOR THE LAST INCREMENT SHOULD BE CLASSED AS A MISTAKE IN BID COVERED BY ASPR 2-406.3, RATHER THAN AS AN OMISSION WHICH WOULD JUSTIFY REJECTION OF THE BID. SUPPORT OF THE ALLEGATION OF ERROR, YOU HAVE SUBMITTED A COPY OF YOUR ORIGINAL WORKSHEET WHICH SHOWS A PRICE FOR EACH OF THE INCREMENT QUANTITIES IN THE OPTION.

IT IS A FUNDAMENTAL PRINCIPLE OF THE COMPETITIVE BID SYSTEM THAT IN ORDER TO BE CONSIDERED FOR AWARD A BID MUST COMPLY IN ALL MATERIAL RESPECTS WITH THE REQUIREMENTS OF THE INVITATION FOR BIDS AT THE TIME OF THE BID OPENING. A BIDDER MAY NOT BE PERMITTED TO ADD TO OR MODIFY ITS BID AFTER THE OPENING TO MAKE THE BID COMPLY WITH THE REQUIREMENTS OF THE INVITATION, AND ITS DOES NOT MATTER WHETHER THE FAILURE TO COMPLY WAS DUE TO INADVERTENCE, MISTAKE OR OTHERWISE. 38 COMP. GEN. 819; 40 ID. 132, 134. THE FAILURE TO QUOTE ON THE OPTION QUANTITY COVERED BY ITEM 1K UNQUESTIONABLY WAS A MATERIAL DEVIATION IN THAT IT DEPRIVED THE GOVERNMENT OF A SUBSTANTIVE AND VALUABLE RIGHT TO INCREASE THE QUANTITY BY 901 TO 1,000 UNITS ANY TIME WITHIN 180 DAYS AFTER RECEIPT OF NOTICE OF AWARD. FURTHERMORE, THE INVITATION SPECIFICALLY PROVIDED THAT "BIDDERS MUST BID ON ALL ITEMS (PRODUCTION QUANTITY, FIRST ARTICLES AND OPTION QUANTITY) OR THEIR BIDS WILL BE REJECTED AS NONRESPONSIVE;,

IN REGARD TO YOUR ALLEGATION THAT THE BID CONTAINED A STATEMENT THAT THE PRICE QUOTED FOR THE BASIC QUANTITY COULD BE USED FOR ANY OPTION QUANTITY AWARDED AT THE TIME THE BASIC QUANTITY WAS AWARDED, WHILE SUCH PRICE COULD BE USED FOR OPTION QUANTITIES AWARDED AT THE SAME TIME AS THE BASIC QUANTITY, THAT PRICE COULD NOT BE USED FOR OPTION QUANTITIES AWARDED AFTER DATE OF THE INITIAL AWARD.

IN VIEW OF THE FOREGOING, THE REJECTION OF YOUR BID DOES NOT APPEAR TO HAVE BEEN IMPROPER. YOUR PROTEST IS ACCORDINGLY DENIED.