B-160167, OCT. 6, 1966

B-160167: Oct 6, 1966

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VETERANS ADMINISTRATION: REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 28. TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. V5148C-91 IS BASED. WAS ACCEPTED. THE COMPANY'S BID PRICE FOR THE WORK WOULD HAVE BEEN $7. 660 AND THAT THE GOVERNMENT ESTIMATE WAS $7. WE AGREE WITH THE STATEMENT OF THE DIRECTOR THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR IN THE COMPANY'S BID AND. THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING VERIFICATION THEREOF. THERE IS LITTLE ROOM FOR DOUBT THAT THE ECONOMY PAINTING CO. PAYMENT FOR THE WORK IS AUTHORIZED TO BE MADE ON THAT BASIS. THE BID AS CORRECTED WILL STILL BE THE LOWEST BID RECEIVED ON THE WORK.

B-160167, OCT. 6, 1966

TO THE ADMINISTRATOR, VETERANS ADMINISTRATION:

REFERENCE IS MADE TO A LETTER DATED SEPTEMBER 28, 1966, WITH ENCLOSURES, FILE REFERENCE 134G, FROM THE DIRECTOR, SUPPLY SERVICE, DEPARTMENT OF MEDICINE AND SURGERY, REQUESTING A DECISION AS TO THE ACTION TO BE TAKEN CONCERNING AN ERROR ALLEGED BY THE ECONOMY PAINTING CO. TO HAVE BEEN MADE IN ITS BID ON WHICH CONTRACT NO. V5148C-91 IS BASED.

THE VETERANS ADMINISTRATION HOSPITAL, LEBANON, PENNSYLVANIA, BY INVITATION FOR BIDS NO. 67-24 (U-202) REQUESTED BIDS FOR FURNISHING LABOR AND MATERIALS AND FOR PERFORMING ALL WORK NECESSARY FOR THE EXTERIOR PAINTING OF VARIOUS BUILDINGS AT THE HOSPITAL. IN RESPONSE THERETO THE ECONOMY PAINTING CO. SUBMITTED A BID OFFERING TO PERFORM THE WORK FOR THE LUMP SUM OF $5,920. ON AUGUST 29, 1966, THE BID OF THE ECONOMY PAINTING CO. WAS ACCEPTED.

BY LETTER DATED AUGUST 30, 1966, THE ECONOMY PAINTING CO. ADVISED THE CONTRACTING OFFICE THAT AN ERROR HAD BEEN MADE IN ITS BID IN THAT IT HAD FAILED TO INCLUDE IN ITS BID PRICE THE COST OF THE DORMERS ON BUILDING NO. 17 AND THE COST OF ALL THE MATERIALS TO BE FURNISHED BY THE COMPANY. THE COMPANY REQUESTED THAT IT BE PERMITTED TO WITHDRAW ITS BID. IN SUPPORT OF ITS ALLEGATION OF ERROR, THE COMPANY BY LETTER DATED SEPTEMBER 2, 1966, SUBMITTED ITS ORIGINAL AND REVISED WORKSHEETS. THE WORKSHEETS INDICATE THAT BUT FOR THE ERROR, THE COMPANY'S BID PRICE FOR THE WORK WOULD HAVE BEEN $7,745.

IN HIS REPORT THE CONTRACTING OFFICER STATES THAT AN EXAMINATION OF THE COMPANY'S WORKSHEETS SUBSTANTIATES THAT THE COMPANY MADE AN ERROR IN ITS BID, AS ALLEGED. THE CONTRACTING OFFICER HAS RECOMMENDED THAT THE CONTRACT PRICE OF THE WORK BE INCREASED BY $1,825 FROM $5,920 TO $7,745 TO COVER THE COST OF THE OMITTED WORK AND MATERIALS.

THE RECORD INDICATES THAT THE SIX OTHER BIDDERS ON THE PROJECT QUOTED JOB PRICES RANGING FROM $9,379 TO $11,660 AND THAT THE GOVERNMENT ESTIMATE WAS $7,500. IN VIEW OF THE SUBSTANTIAL DIFFERENCE BETWEEN THE BID OF THE COMPANY IN THE AMOUNT OF $5,920 AND THE OTHER BIDS AND THE GOVERNMENT ESTIMATE, WE AGREE WITH THE STATEMENT OF THE DIRECTOR THAT THE CONTRACTING OFFICER SHOULD HAVE BEEN AWARE OF THE PROBABILITY OF ERROR IN THE COMPANY'S BID AND, CONSEQUENTLY, THE BID SHOULD NOT HAVE BEEN ACCEPTED WITHOUT REQUESTING VERIFICATION THEREOF.

ON THE BASIS OF THE FACTS AND EVIDENCE OF RECORD, THERE IS LITTLE ROOM FOR DOUBT THAT THE ECONOMY PAINTING CO. MADE A BONA FIDE ERROR IN ITS BID, AS ALLEGED. ACCORDINGLY, SINCE ECONOMY HAS ESTABLISHED ITS INTENDED BID PRICE, CONTRACT NO. V5148C-91 MAY BE AMENDED TO PROVIDE FOR A PRICE OF $7,745 FOR THE WORK INVOLVED, AS ADMINISTRATIVELY RECOMMENDED, AND PAYMENT FOR THE WORK IS AUTHORIZED TO BE MADE ON THAT BASIS. THE BID AS CORRECTED WILL STILL BE THE LOWEST BID RECEIVED ON THE WORK.

A REFERENCE TO THIS DECISION SHOULD BE MADE ON THE AMENDMENT TO THE CONTRACT.