B-160659, JUN. 9, 1967

B-160659: Jun 9, 1967

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

TO BALDWIN-LIMA-HAMILTON CORPORATION: REFERENCE IS MADE TO YOUR PROTEST BY TELEGRAM DATED JANUARY 11. THE PROCUREMENT WAS TWICE ADVERTISED BY THE UNITED STATES ARMY ENGINEER DISTRICT. WAS CANCELED AFTER REJECTION OF ALL BIDS ON THE BASIS OF TECHNICAL NONRESPONSIVENESS. WAS THE BASIS FOR THE AWARD TO ALLIS-CHALMERS ON MARCH 2. WHICH IS THE SUBJECT OF YOUR PROTEST. OUR FILES WERE CLOSED WITHOUT FURTHER ACTION. YOU WERE SO NOTIFIED BY LETTER DATED NOVEMBER 7. THAT AFTER AN EXCHANGE OF CORRESPONDENCE BETWEEN THE PROCURING ACTIVITY AND YOU AND YOUR ATTORNEYS THE PROTEST WAS DENIED BY THE CONTRACTING OFFICER IN A LETTER DATED JANUARY 20. THE RECORDS FURTHER SHOW THAT THE MATTER WAS RECONSIDERED BY THE DEPARTMENT OF THE ARMY AFTER YOU FILED A PROTEST ON THE SAME SOLICITATION WITH OUR OFFICE.

B-160659, JUN. 9, 1967

TO BALDWIN-LIMA-HAMILTON CORPORATION:

REFERENCE IS MADE TO YOUR PROTEST BY TELEGRAM DATED JANUARY 11, 1967, AS SUPPLEMENTED BY YOUR TELEGRAM OF JANUARY 25 AND BY CORRESPONDENCE FROM YOUR ATTORNEYS, AGAINST THE AWARD BY THE DEPARTMENT OF THE ARMY TO THE ALLIS-CHALMERS MANUFACTURING CO. (ALLIS CHALMERS) OF A CONTRACT FOR THE MANUFACTURE OF THREE HYDRAULIC TURBINES WITH SPEED INCREASERS FOR THE WEBBERS FALLS LOCK AND DAM, OKLAHOMA. THE PROCUREMENT WAS TWICE ADVERTISED BY THE UNITED STATES ARMY ENGINEER DISTRICT, TULSA, OKLAHOMA. THE FIRST SOLICITATION, INVITATION FOR BIDS (IFB) NO. CIVENG-34-066-66-87, ISSUED MARCH 15, 1966, WAS CANCELED AFTER REJECTION OF ALL BIDS ON THE BASIS OF TECHNICAL NONRESPONSIVENESS. THE SECOND SOLICITATION, IFB NO. DACW56 67-B-0026, ISSUED SEPTEMBER 15, 1966, WAS THE BASIS FOR THE AWARD TO ALLIS-CHALMERS ON MARCH 2, 1967, WHICH IS THE SUBJECT OF YOUR PROTEST.

OUR RECORDS SHOW THAT YOUR ATTORNEYS BY LETTER DATED AUGUST 29, 1966, FILED A PROTEST WITH OUR OFFICE AGAINST THE REJECTION OF YOUR LOW BID UNDER THE ORIGINAL IFB. BY LETTER DATED NOVEMBER 2, 1966, HOWEVER, YOUR ATTORNEYS WITHDREW THE PROTEST WITH A STATEMENT TO THE EFFECT THAT, IN VIEW OF CERTAIN DISCUSSIONS AND AGREEMENTS BETWEEN YOU AND THE CORPS OF ENGINEERS, ANY DECISION ON THE ISSUES INVOLVED WOULD BE UNNECESSARY. ACCORDINGLY, OUR FILES WERE CLOSED WITHOUT FURTHER ACTION, AND YOU WERE SO NOTIFIED BY LETTER DATED NOVEMBER 7, 1966.

WITH RESPECT TO THE SECOND SOLICITATION, THE RECORDS SHOW THAT YOU FIRST FILED A PROTEST WITH THE PROCURING ACTIVITY BY TELEGRAM DATED NOVEMBER 17, 1966, AGAINST AWARD TO ALLIS-CHALMERS, THE LOW BIDDER, AND THAT AFTER AN EXCHANGE OF CORRESPONDENCE BETWEEN THE PROCURING ACTIVITY AND YOU AND YOUR ATTORNEYS THE PROTEST WAS DENIED BY THE CONTRACTING OFFICER IN A LETTER DATED JANUARY 20, 1967. THE RECORDS FURTHER SHOW THAT THE MATTER WAS RECONSIDERED BY THE DEPARTMENT OF THE ARMY AFTER YOU FILED A PROTEST ON THE SAME SOLICITATION WITH OUR OFFICE. HOWEVER, THE CONTRACTING OFFICER'S ACTION WAS ULTIMATELY AFFIRMED, AND, PURSUANT TO ARMED SERVICES PROCUREMENT REGULATION (ASPR) 2-407.9 (B) (3), AWARD TO ALLIS-CHALMERS, WITHOUT AWAITING THE DECISION OF OUR OFFICE ON YOUR PROTEST, WAS AUTHORIZED ON THE BASIS OF URGENCY, AND YOU WERE SO ADVISED BY LETTER DATED FEBRUARY 21, 1967.

IN YOUR PROTEST TO OUR OFFICE ON THE SECOND IFB, YOU REQUEST THAT WE GIVE CONSIDERATION TO FIVE DIFFERENT ISSUES WHICH YOU PREVIOUSLY SET FORTH IN YOUR PROTEST OF NOVEMBER 17, 1966, TO THE DEPARTMENT OF THE ARMY. ADDITION, YOUR ATTORNEYS NOW CONTEND THAT THE ACTION OF THE DEPARTMENT IN REJECTING YOUR LOW BID UNDER THE ORIGINAL IFB ON THE BASIS OF INADEQUATE DESCRIPTIVE DATA IS INCONSISTENT WITH ITS ACTION OF WAIVING AN ALLEGEDLY SIMILAR DEFICIENCY IN THE LOW BID OF ALLIS CHALMERS UNDER THE SECOND IFB. FURTHER, THE NEED FOR AWARD WITHOUT DELAY FOR DECISION BY OUR OFFICE IS QUESTIONED NOTWITHSTANDING THE ADMINISTRATIVE STATEMENTS CONCERNING THE URGENCY OF THE PROCUREMENT. EACH ISSUE, NUMBERED FOR CONVENIENCE, WILL BE CONSIDERED BELOW TOGETHER WITH THE PERTINENT ADMINISTRATIVE COMMENTS, INCLUDING A STATEMENT DATED FEBRUARY 1, 1967, BY THE CONTRACTING OFFICER, WHICH WAS MADE AVAILABLE TO YOUR ATTORNEYS, AND A REBUTTAL LETTER DATED MARCH 17, 1967, SUBMITTED BY YOUR ATTORNEYS.

1. THE ALLIS-CHALMERS BID BOND WAS NOT DATED.

THE BID GUARANTEE CLAUSE ON PAGE 7 OF THE IFB CAUTIONED BIDDERS THAT THE FAILURE TO FURNISH THE REQUIRED BILL GUARANTEES IN THE PROPER FORM AND AMOUNT BY THE TIME SET FOR OPENING OF BIDS MIGHT BE CAUSE FOR REJECTION OF A BID, AND THE PINK CHECKLIST SHEET INCLUDED IN EACH SET OF BID PAPERS REMINDED BIDDERS THAT THE BID BOND SHOULD NOT BE DATED PRIOR TO THE BID. ACCORDINGLY, YOU CONTEND THAT WITHOUT AN EFFECTIVE DATE (I.E., THE DATE OF EXECUTION) THE ALLIS-CHALMERS BID BOND COULD BE CANCELED BY THE BONDING COMPANY AND IS THEREFORE NOT ENFORCEABLE; CONSEQUENTLY, YOU STATE, THE DEFECT IS NOT A SIMPLE ERROR BUT A SERIOUS OMISSION WHICH RENDERS THE BID NONRESPONSIVE. NO OTHER DEFICIENCY IS NOTED IN THE BOND, WHICH IDENTIFIES THE PROCUREMENT BY THE IFB NUMBER AND BY THE BID DATE, WHICH IS ALSO THE BID OPENING DATE.

IN THE LETTER OF JANUARY 20, 1967, TO YOU, THE CONTRACTING OFFICER CITED 39 COMP. GEN. 60, IN WHICH WE HELD THAT A BID BOND WHICH WAS DATED PRIOR TO THE DATE OF THE BID BUT WHICH SPECIFICALLY IDENTIFIED THE PROCUREMENT FOR WHICH IT WAS INTENDED WAS ONLY TECHNICALLY DEFECTIVE AND DID NOT MAKE THE BID NONRESPONSIVE TO THE INVITATION. REFERRING SPECIFICALLY TO OUR STATEMENT AT PAGE 62, THAT A BOND WHICH IS ERRONEOUSLY DATED OR BEARS NO DATE AT ALL IS NOT THEREBY RENDERED INVALID IF IT COMPLIES WITH THE OTHER ESSENTIALS NECESSARY TO GIVE IT A LEGAL AND BINDING EFFECT, AND TO THE CASE OF IN RE MOFFITT'S ESTATE, 75 A.2D 698, WHICH WE CITED, THE CONTRACTING OFFICER ASSERTS THAT THE ABSENCE OF THE DATE OF EXECUTION ON THE ALLIS-CHALMERS BOND IS A MINOR IRREGULARITY WHICH MAY BE WAIVED UNDER ASPR 2-405.

IN B-159209, JUNE 23, 1966, WE HAD OCCASION TO AGAIN CONSIDER A PROCUREMENT IN WHICH A BID BOND BORE AN EXECUTION DATE WHICH WAS EARLIER THAN THE BID DATE AND THE ARGUMENT WAS ADVANCED THAT THE BID WAS THEREBY RENDERED NONRESPONSIVE. CONSISTENT WITH 39 COMP. GEN. 60, WE HELD THAT IDENTIFICATION OF THE BID BY THE IFB NUMBER AND OTHER INFORMATION IN THE BOND WERE SUFFICIENT TO ELIMINATE ANY CONFUSION AS TO WHAT THE BOND COVERED; ACCORDINGLY, NOTWITHSTANDING THE ERRONEOUS DATE, THE BOND WAS ENFORCEABLE. IN ADDITION TO 39 COMP. GEN. 60 AND THE MOFFITT CASE, SUPRA, WE CITED 12 AM.JUR.2D,"BONDS," SECTION 4 (PAGE 408), FOR THE PRINCIPLE THAT DEFECTS, OR ERRORS IN THE CONTENT OR EXECUTION OF A BOND, IF NOT OF MATERIAL CHARACTER, WILL NOT ORDINARILY CHANGE THE VALIDITY OR EFFECT OF THE INSTRUMENT. THEREFORE, WE REJECTED THE CONTENTION THAT THE BID NONRESPONSIVE BY REASON OF THE BOND DEFECT AND DENIED THE PROTEST.

IN LINE WITH THE FOREGOING, IT IS OUR VIEW THAT THE ALLIS-CHALMERS BID BOND IS NOT RENDERED UNENFORCEABLE BY REASON OF THE ABSENCE OF THE EXECUTION DATE, THERE BEING NO DOUBT, AS TO THE BID COVERED THEREBY, THE BOND BEING IN THE PROPER AMOUNT, AND THERE BEING NO OTHER DEFECT. ACCORDINGLY, WE CONCUR WITH THE VIEW OF THE CONTRACTING OFFICER THAT THE OMISSION OF THE EXECUTION DATE IS BUT A MINOR DEFECT WHICH MAY PROPERLY BE WAIVED UNDER ASPR 2-405.

2. THE ALLIS-CHALMERS BID COVER LETTER DATED NOVEMBER 11, 1966, IS SIGNED BY AN UNAUTHORIZED PERSON.

ON THIS ISSUE, YOU POINT OUT THAT THE PERSON WHO SIGNED THE LETTER, WHICH YOU CONTEND INCORPORATES IN THE BID THE INFORMATION AND DATA REQUIRED BY THE SPECIFICATIONS, IS AN UNAUTHORIZED PERSON AND NOT THE SAME PERSON WHO SIGNED THE BID; THAT THE PINK CHECKLIST SHEET INCLUDED IN THE BID SETS CAUTIONED BIDDERS ABOUT PROPER SIGNING OF BIDS; AND THAT THE EFFECT OF HAVING THE COVER LETTER SIGNED BY AN UNAUTHORIZED PERSON IS TO RELIEVE ALLIS-CHALMERS FROM LIABILITY TO COMPLY WITH THE INFORMATION AND DATA THEREBY TRANSMITTED. IN ADDITION, YOUR ATTORNEYS CONTEND THAT SINCE ALLIS -CHALMERS IS NOT BOUND BY THE DATA, THERE IS NO BASIS FOR EVALUATION OF ITS BID. NO QUESTION IS RAISED, HOWEVER, CONCERNING THE AUTHORITY OF THE ALLIS-CHALMERS OFFICIAL WHO SIGNED THE BID FORM, WHICH IS DATED FOUR DAYS SUBSEQUENT TO THE DATE ON THE COVER LETTER.

IN THE LETTER OF JANUARY 20, 1967, TO YOU, THE CONTRACTING OFFICER TOOK THE POSITION THAT THE ALLIS-CHALMERS COVER LETTER, ALTHOUGH NOT EXECUTED IN THE SAME MANNER AND BY THE SAME PERSON AS THE FORMAL BID FORM, NEVERTHELESS CONSTITUTES A PART OF THE BID, WHICH IT ACCOMPANIED AND OF WHICH IT WAS INTENDED TO BE A PART. IN THIS CONNECTION, THE CONTRACTING OFFICER CITED B-160013, OCTOBER 27, 1966, 46 COMP. GEN. -- --, IN WHICH WE HELD THAT A LETTER TRANSMITTED WITH A BID, WHICH REFERRED TO THE BID FORM, WAS PART OF THE BID; THEREFORE, A QUALIFYING STATEMENT IN THE LETTER WAS FOR CONSIDERATION IN DETERMINING WHETHER THE BID WAS RESPONSIVE.

IN HIS REPORT DATED FEBRUARY 1, 1967, THE CONTRACTING OFFICER STATED THAT HE HAD RECEIVED WRITTEN CONFIRMATION OF THE AUTHORITY OF THE INDIVIDUAL WHO SIGNED THE ALLIS-CHALMERS COVER LETTER TO SIGN SUCH

LETTER AND TO SUBMIT TECHNICAL DATA FOR THE BIDDER. A COPY OF THE LETTER, WHICH IS DATED JANUARY 17, 1967, AND BEARS THE SIGNATURE OF THE ALLIS-CHALMERS OFFICIAL WHO SIGNED THE BID, INDICATES THAT THE INDIVIDUAL WHO SIGNED THE COVER LETTER IS THE ENGINEER WHO PREPARED THE TECHNICAL DATA SUBMITTED WITH THE ALLIS-CHALMERS BID AND THAT HE WAS AUTHORIZED TO MAKE ANY CHANGES, DELETIONS AND/OR ADDITIONS TO SUCH PORTION OF THE BID. NOTWITHSTANDING SUCH STATEMENT, YOUR ATTORNEYS CONTEND THAT THE GOVERNMENT'S CONTRACT WITH ALLIS-CHALMERS IS NOT ENFORCEABLE BY REASON OF THE FACT THAT SUCH INDIVIDUAL WAS NOT AUTHORIZED TO SIGN THE BID.

THERE IS NO REQUIREMENT IN THE PROCUREMENT STATUTES OR REGULATIONS THAT A BID BE ACCOMPANIED BY A COVER OR TRANSMITTAL LETTER. HOWEVER, WHEN A LETTER OR OTHER DOCUMENTS EITHER ACCOMPANY A BID OR ARE RECEIVED SEPARATELY BEFORE THE SCHEDULED TIME OF BID OPENING, THEY CONSTITUTE PART OF THE BID AND MUST BE CONSIDERED IN ITS EVALUATION. 45 COMP. GEN. 397 AND DECISIONS THEREIN CITED. THIS RULE IS FOR APPLICATION EVEN THOUGH THE LETTER MAY BEAR THE SIGNATURE OF SOMEONE OTHER THAN THE INDIVIDUAL WHO EXECUTED THE BID FORM (B-150805, MAY 10, 1963) OR THE BIDDER MAY CONTEND AFTER BID OPENING THAT THE LETTER WAS NOT EXPRESSLY MADE A PART OF ITS BID (B-160013, SUPRA).

UNDER THESE HOLDINGS THE ALLIS-CHALMERS DESCRIPTIVE DATA AND THE COVER LETTER BOTH CONSTITUTE PARTS OF THE BID WHICH MUST BE CONSIDERED IN ITS EVALUATION. MOREOVER, SINCE THE BID BEARS A DATE FOUR DAYS SUBSEQUENT TO THE DATE OF THE COVER LETTER, AND WOULD BE INCOMPLETE WITHOUT THE DATA IDENTIFIED IN THE LETTER, THERE IS A REASONABLE BASIS FOR THE ASSUMPTION THAT THE OFFICIAL WHO SIGNED THE BID THEREBY ADOPTED THE LETTER AND DATA AS A PART OF THE BID AND RATIFIED THE SIGNATURE OF THE EMPLOYEES WHO SIGNED THE LETTER, WHOSE AUTHORITY TO BIND THE COMPANY HAS ALSO BEEN CONFIRMED SINCE THE BID OPENING. WE THEREFORE AGREE WITH THE DECISION OF THE CONTRACTING OFFICER THAT HE WAS BOUND TO CONSIDER SUCH LETTER AND THE MATERIAL TRANSMITTED THEREWITH IN EVALUATING THE ALLIS-CHALMERS BID.

3. A MODIFICATION TO THE PERFORMANCE CURVE SUBMITTED WITH THE ALLIS CHALMERS BID WAS INITIALED BY AN UNAUTHORIZED PERSON AND NOT DATED.

THE ITEM IN QUESTION, A GRAPH, WAS ONE OF THE ENCLOSURES TRANSMITTED WITH THE BID COVER LETTER, AND THE PERSON WHO INITIALED THE CHANGE ON THE DOCUMENT HAS BEEN IDENTIFIED AS THE PERSON WHO ALSO SIGNED THE ALLIS- CHALMERS BID COVER LETTER AND HAD AUTHORITY TO MAKE CHANGES IN SUCH DOCUMENT. CITING PARAGRAPH 1 (B) OF THE BIDDING INSTRUCTIONS ON STANDARD FORM 33-A, INCORPORATED IN THE BID TERMS, WHICH PROVIDES THAT ALL ERASURES OR OTHER CHANGES MUST BE INITIALED BY THE PERSON SIGNING THE BID, YOU AND YOUR ATTORNEYS CONTEND THAT SUCH DEFICIENCY RENDERS THE BID NONRESPONSIVE, THE MODIFICATION NOT BEING ENFORCEABLE AGAINST ALLIS-CHALMERS.

IN HIS LETTER OF JANUARY 20, 1967, TO YOU, THE CONTRACTING OFFICER NOTED THAT THE IFB SPECIFICATIONS ALLOW A RATED SPEED BETWEEN 60 TO 60.5 R.P.M. AND THAT THE MODIFICATION IN QUESTION CHANGED THE SPEED FROM 60 TO 60.24 R.P.M.; THEREFORE, IT MAKE NO DIFFERENCE WHETHER THE MODIFICATION IS ACCOMPLISHED. FURTHER, THE CONTRACTING OFFICER CITED B 159813, OCTOBER 13, 1966, 46 COMP. GEN. -----, IN WHICH WE HELD THAT AN INDIVIDUAL WHO INITIALED CHANGES IN A BID WHICH AFFECTED THE PRICES, ALTHOUGH NOT THE SIGNER OF THE BID, WAS THE OSTENSIBLE AGENT OF THE BIDDER AUTHORIZED TO ACT IN SUCH CAPACITY. IN THE CIRCUMSTANCES, AND PARTICULARLY IN VIEW OF THE ADOPTION OF ALL THE DATA BY THE SUBSEQUENT SIGNATURE OF THE BID, AS MENTIONED IN THE PRECEDING PARAGRAPH, WE CONCUR WITH THE VIEW OF THE CONTRACTING OFFICER THAT THE FAILURE OF ALLIS-CHALMERS TO COMPLY WITH THE BID INSTRUCTIONS, BY NOT HAVING THE PERFORMANCE CURVE GRAPH CHANGE, WHICH WAS MADE PRIOR TO SUBMISSION OF THE BID, INITIALED BY THE PERSON WHO SIGNED THE BID, IS AT MOST A MINOR DEFICIENCY WHICH MAY BE WAIVED UNDER ASPR 2-405.

4. THE ALLIS-CHALMERS BID COVER LETTER CONTAINS A STATEMENT CONCERNING TAXES WHICH IS IN CONFLICT WITH PARAGRAPH 23 OF THE STANDARD SUPPLY CONTRACT PROVISIONS INCLUDED IN THE IFB AND WITH THE STATEMENT IN THE BID THAT THE AMOUNT OF $120,000 WAS INCLUDED TO COVER IMPORT DUTIES.

THE IFB PROVISION IN QUESTION READS, IN PART, AS FOLLOWS:

"23. FEDERAL, STATE, AND LOCAL TAXES (AUG 1961)

"/A) EXCEPT AS MAY BE OTHERWISE PROVIDED IN THIS CONTRACT, THE CONTRACT PRICE INCLUDES ALL APPLICABLE FEDERAL, STATE, AND LOCAL TAXES AND DUTIES.

"/B) NEVERTHELESS, WITH RESPECT TO ANY FEDERAL EXCISE TAX OR DUTY ON THE TRANSACTIONS OR PROPERTY COVERED BY THIS CONTRACT, IF A STATUTE, COURT DECISION, WRITTEN RULING, OR REGULATION TAKES EFFECT AFTER THE CONTRACT DATE, AND -- (1) RESULTS IN THE CONTRACTOR BEING REQUIRED TO PAY OR BEAR THE BURDEN OF ANY SUCH FEDERAL EXCISE TAX OR DUTY OR INCREASE IN THE RATE THEREOF WHICH WOULD NOT OTHERWISE HAVE BEEN PAYABLE ON SUCH TRANSACTIONS OR PROPERTY, THE CONTRACT PRICE SHALL BE INCREASED BY THE AMOUNT OF SUCH TAX OR DUTY OR RATE INCREASE, PROVIDED THE CONTRACTOR WARRANTS IN WRITING THAT NO AMOUNT FOR SUCH NEWLY IMPOSED FEDERAL EXCISE TAX OR DUTY OR RATE INCREASE WAS INCLUDED IN THE CONTRACT PRICE AS A CONTINGENCY RESERVE OR OTHERWISE;

* * * * * * * * * * * * * * * * * * "/C) NO ADJUSTMENT OF LESS THAN $100 SHALL BE MADE IN THE CONTRACT PRICE PURSUANT TO PARAGRAPH (B) ABOVE.'

IN ADDITION, BIDDERS WERE REQUIRED BY AMENDMENT NO. 6 TO THE IFB TO STATE, WITH RESPECT TO ANY EQUIPMENT OR MATERIALS OF FOREIGN ORIGIN OFFERED IN THEIR BIDS, THE AMOUNT INCLUDED IN THE BIDS TO COVER APPLICABLE DUTY.

THE STATEMENT IN THE ALLIS-CHALMERS COVER LETTER, WHICH YOU QUESTION, READS AS FOLLOWS:

"IN REFERENCE TO STANDARD SUPPLY CONTRACT PROVISIONS, PARAGRAPH 23, NO AMOUNT HAS BEEN ADDED TO THE CONTRACT PRICE FOR ANY FEDERAL EXCISE TAX OR DUTY, OR RATE INCREASE WHICH MAY BE IMPOSED AFTER THE CONTRACT DATE.'

SUCH STATEMENT, IN OUR OPINION, IS MERELY THE TYPE STATEMENT WHICH WOULD BE REQUIRED TO SUPPORT AN ADJUSTMENT UNDER SUBPARAGRAPH 23 (B) (1) FOR FEDERAL EXCISE TAXES OR DUTIES IMPOSED OR INCREASED AFTER THE CONTRACT DATE. WHILE THE PLACING OF THE COMMA AFTER THE WORD "DUTY" WOULD TEND TO SUPPORT YOUR CONSTRUCTION, THAT IS, THAT THE FINAL CLAUSE "IMPOSED AFTER THE CONTRACT ATE" REFERS ONLY TO "RATE INCREASE" AND NOT TO ANY PORTION OF THE SENTENCE PRECEDING THE COMMA, WE CONSIDER SUCH AN INTERPRETATION TO BE TOO FORCED AND ARTIFICIAL TO OVERCOME WHAT WE CONSIDER THE PLAIN INTENT TO CONFORM TO THE PROVISIONS OF PARAGRAPH 23 RATHER THAN TO EXCEPT TO IT. ACCORDINGLY, WE ARE UNABLE TO CONCUR WITH YOUR VIEW THAT THE STATEMENT IN QUESTION RENDERS THE ALLIS-CHALMERS BID NONRESPONSIVE.

5. THE WATER PASSAGE DIMENSIONED DRAWINGS SUBMITTED BY ALLIS CHALMERS ARE NOT SUFFICIENT TO SHOW COMPLIANCE WITH REQUIREMENTS INVOLVING WATER VELOCITY PAST THE WICKET GATES AND IN THE DRAFT TUBE LINER.

YOU CONTEND THAT ABSENT THE DIMENSIONS FOR THE WATER PASSAGES, IT IS IMPOSSIBLE TO DETERMINE THAT ALLIS-CHALMERS MEETS THE SPECIFICATION REQUIREMENTS. HOWEVER, THE CONTRACTING OFFICER, IN HIS LETTER OF JANUARY 20, 1967, TO YOU, QUOTED A PORTION OF A TECHNICAL REVIEW REPORT STATING THAT THE ALLIS-CHALMERS SCALED DRAWING OF THE WATER PASSAGE, WHICH SHOWS THE COMPLETE WATER PASSAGE AND ELEVATIONS FOR TOP OF INTAKE FLOOR, MAXIMUM ELEVATION OF TOP OF DRAFT TUBE, AND DRAFT TUBE EXIT AND FLOOR CEILING, MEETS THE IFB REQUIREMENT THAT SUCH DRAWING SHOW THE PRINCIPAL DIMENSIONS OF INTAKE WATER PASSAGE AND DRAFT TUBE; THAT HAD IT BEEN CONSIDERED NECESSARY TO HAVE INFORMATION WITH THE BID TO DETERMINE THE WATER VELOCITIES THROUGH THE TURBINE, A SPECIFIC REQUIREMENT THEREFOR WOULD HAVE BEEN INCLUDED IN THE IFB; AND THAT COMPLIANCE WITH THE VELOCITY REQUIREMENTS, AS WITH ALL OF THE OTHER SPECIFIC REQUIREMENTS SET FORTH IN THE TECHNICAL PROVISIONS, WILL BE OBTAINED DURING REVIEW OF THE SHOP DRAWINGS FOR THE EQUIPMENT. ACCORDINGLY, THE CONTRACTING OFFICER CONCLUDED THAT THE DATA SUBMITTED BY ALLIS-CHALMERS WERE SUFFICIENT FOR THE INTENDED PURPOSE, A DETERMINATION WHICH IS PRIMARILY THE RESPONSIBILITY OF THE PROCURING AGENCY.

YOUR ATTORNEYS CONTEND THAT THIS IS THE AREA IN WHICH THE DEPARTMENT OF THE ARMY HAS TAKEN INCONSISTENT ACTION UNDER THE TWO IFB S. REFERRING TO THE ORIGINAL IFB, IT IS ASSERTED BY YOUR ATTORNEYS THAT YOUR LOW BID WAS REJECTED BECAUSE YOU FAILED TO SHOW THE HEIGHT OF THE DRAFT TUBE EXIT ON A PARTICULAR DRAWING AND FOR OTHER TECHNICAL DATA DEFICIENCIES. ACCORDINGLY, IT IS STATED, THE WAIVER BY THE DEPARTMENT OF THE ALLIS- CHALMERS TECHNICAL DATA DEFICIENCIES UNDER THE SECOND IFB, WHICH ARE ALLEGED TO BE SIMILAR TO THE DISCREPANCIES IN YOUR ORIGINAL BID, CONSTITUTES THE APPLICATION OF TWO DIFFERENT STANDARDS FOR EVALUATION OF TECHNICAL DATA, RESULTING IN UNEQUAL TREATMENT OF BIDDERS, I.E., YOU AND ALLIS-CHALMERS. FURTHER, YOUR ATTORNEYS CONTEND THAT THE DECISIONS OF OUR OFFICE, INCLUDING 36 COMP. GEN. 376, 378; 39 ID. 247, 248, AND 43 ID. 707, RELATING TO DESCRIPTIVE DATA REQUIREMENTS, SUPPORT YOUR CONTENTION THAT THE ALLIS CHALMERS BID MUST BE REJECTED.

THE QUESTION WHETHER DATA AND INFORMATION REQUIRED TO BE SUBMITTED WITH A BID MEET THE REQUIREMENTS IN THE INVITATION FOR BIDS IS A FACTUAL MATTER PRIMARILY FOR DETERMINATION BY THE PROCURING AGENCY, AND WHEN AN EXPLANATION IS GIVEN IN GOOD FAITH BY THE AGENCY SHOWING SOME GROUNDS FOR ITS DETERMINATION CONCERNING THE SUFFICIENCY OF THE DATA, OUR OFFICE WILL NOT MAKE A CONTRARY CONCLUSION. 43 COMP. GEN. 77. IN ACCORDANCE WITH THIS PRINCIPLE, WE SEE NO REASON TO QUESTION THE PROCURING AGENCY'S TECHNICAL OPINION THAT THE WATER PASSAGE DRAWING SUBMITTED BY ALLIS- CHALMERS SHOWING THE PRINCIPAL DIMENSIONS OF THE WATER PASSAGES AND DRAFT TUBE MEETS THE MINIMUM REQUIREMENTS OF THE IFB.

WITH SPECIFIC REFERENCE TO THE REJECTION OF YOUR LOW BID UNDER THE ORIGINAL IFB, THE DEPARTMENT, IN A STATEMENT DATED APRIL 21, 1967, CALLS ATTENTION TO THE FACT THAT IN THE CONTRACTING OFFICER'S MEMORANDUM OF JUNE 22, 1966, CITED IN THE REBUTTAL BY YOUR ATTORNEYS, IT WAS CONCLUDED THAT THE OMISSION IN YOUR BID DATA OF THE HEIGHT OF THE DRAFT TUBE, AS WELL AS THE DEVIATIONS REGARDING SIZING OF GATE AND BLADE SERVOMOTORS, WAS A MINOR IRREGULARITY WHICH COULD BE WAIVED; THEREFORE, THE EVALUATION OF YOUR DESCRIPTIVE DATA DID NOT DIFFER FROM THE EVALUATION OF THE ALLIS-CHALMERS DESCRIPTIVE DATA UNDER THE SECOND IFB. FURTHER, IT IS STATED THAT THE REJECTION OF YOUR ORIGINAL BID WAS OCCASIONED BY SEVERAL MAJOR DEVIATIONS WHICH COULD NOT BE WAIVED, INCLUDING DEVIATIONS PERTAINING TO PERFORMANCE CURVES AND SPEED INCREASERS AND THE PROPOSED CONSTRUCTION OF THE TURBINE SHAFT, WHICH DID NOT MEET THE REQUIREMENTS OF THE SPECIFICATIONS. ADDITION, IT IS POINTED OUT THAT WHILE ALL OF THE BIDS RECEIVED UNDER THE ORIGINAL IFB WERE REJECTED BY REASON OF MAJOR DEVIATIONS FROM THE SPECIFICATIONS, THE TWO BIDS RECEIVED UNDER THE SECOND IFB, FROM YOU AND FROM ALLIS-CHALMERS, WERE FOUND TO BE IN/CONFORMITY WITH THE SPECIFICATIONS AND WITH ALL ESSENTIAL REQUIREMENTS OF THE IFB. ACCORDINGLY, WE ARE UNABLE TO CONCUR WITH THE CONTENTION OF YOUR ATTORNEYS THAT ALL BIDDERS HAVE NOT BEEN ACCORDED EQUAL TREATMENT UNDER BOTH IFB-S.

6. NO REASON APPEARS WHY AWARD CANNOT BE DELAYED FOR A PERIOD OF 30 DAYS PENDING RESOLUTION OF YOUR PROTEST BY OUR OFFICE.

AS JUSTIFICATION FOR AWARD OF THE CONTRACT TO ALLIS-CHALMERS PRIOR TO OUR DECISION ON YOUR PROTEST UNDER THE SECOND IFB, THE CONTRACTING OFFICER, IN A MEMORANDUM DATED FEBRUARY 1, 1967, TO THE CHIEF OF ENGINEERS, MADE THE FOLLOWING PERTINENT STATEMENTS:

"SINCE BALDWIN-LIMA-HAMILTON HAS REQUESTED A REVIEW OF THEIR PROTEST BY THE COMPTROLLER GENERAL, I AM FORWARDING THE NECESSARY DOCUMENTS FOR SUCH A REVIEW PURSUANT TO ASPR 2-407.9 (B) (2) AND (3), APP 2 407.9, AND ECI 2- 407.9. AS MENTIONED IN PREVIOUS CORRESPONDENCE ON THIS PROCUREMENT, A DELAY OF AWARD WILL SERIOUSLY INTERFERE WITH THE PLANNED SEQUENCE OF OPERATIONS AT WEBBERS FALLS LOCK AND DAM, A VITAL LINK IN THE ARKANSAS RIVER NAVIGATION PROJECT. THE PRESENT SCHEDULE CONTEMPLATES THAT THE FIRST STAGE POWERHOUSE PLANS WILL BE PREPARED FROM DATA OBTAINED UNDER TURBINE CONTRACT AND FORWARDED TO THE PRIME CONSTRUCTION CONTRACTOR NOT LATER THAN 1 MARCH 1968. IF AWARD ON THE TURBINE CONTRACT IS DELAYED BEYOND 15 FEBRUARY 1967, THE FIRST STAGE POWERHOUSE PLANS CANNOT BE PREPARED AND DELIVERED TIMELY. AS A RESULT, I EXPECT THAT THE PRIME CONTRACTOR CONSTRUCTING THE LOCK AND DAM WILL FILE A SUSPENSION OF WORK CLAIM AGAINST THE GOVERNMENT. SHOULD THE DELAY IN CONSTRUCTION OF THE FIRST STAGE POWERHOUSE BECOME LENGTHY, THE GOVERNMENT WILL BE FACED WITH THE CHOICE OF: (1) DELAYING USE OF THE WEBBERS FALLS LOCK, WHICH, UNDER PRESENT PLANS, CANNOT BE OPERATED UNTIL THE FIRST STAGE POWERHOUSE HAS BEEN COMPLETED, OR (2) REDESIGNING THE COFFERDAM STRUCTURE AROUND THE POWERHOUSE, AT CONSIDERABLE ADDITIONAL EXPENSE, TO PERMIT USE OF THE LOCK DURING CONSTRUCTION OF THE FIRST STAGE POWERHOUSE.

"THEREFORE, I REQUEST THAT A REVIEW OF THE BALDWIN-LIMA-HAMILTON PROTEST BE ACCOMPLISHED IMMEDIATELY, OR, AS AN ALTERNATIVE, I REQUEST AUTHORITY UNDER ASPR 2-407.9 (B) (3) TO AWARD DESPITE THE PROTEST BECAUSE OF THE CONSEQUENCES MENTIONED ABOVE.'

ALTHOUGH THE CHIEF OF ENGINEERS APPROVED THE AWARD BY TELEGRAM OF FEBRUARY 15, THE MATTER WAS RECONSIDERED ON THE BASIS OF YOUR TELEGRAM OF FEBRUARY 21 STATING THAT SINCE MODEL TESTS AND DATA HAD ALREADY BEEN SUBMITTED BY ALLIS-CHALMERS ON DUPLICATE TURBINES FOR THE OZARK DAM PROJECT, AS INDICATED IN ITS BID COVER LETTER, THE URGENCY WAS MEANINGLESS. IN A MEMORANDUM DATED FEBRUARY 28, 1967, HOWEVER, THE CHIEF OF THE DESIGN BRANCH OF THE ENGINEERING DIVISION ADVISED THE DISTRICT ENGINEER THAT INFORMATION HAD BEEN RECEIVED FROM THE HYDROELECTRIC DESIGN BRANCH, SOUTHWESTERN DIVISION, TO THE EFFECT THAT MODEL TESTS FOR THE OZARK TURBINE CONTRACT SHOWED THAT THE OZARK DESIGN WOULD NOT MEET THE HYDRAULIC CONDITIONS AT THE WEBBERS FALLS PROJECT AND THAT, WITHOUT CHANGES IN THE OZARK DESIGN TO MEET THE DIFFERENT HEAD REQUIREMENTS FOR THE WEBBERS FALLS PROJECT, AN INEFFICIENT TURBINE WOULD BE PRODUCED. ACCORDINGLY IT WAS CONCLUDED THAT MODEL TESTS WOULD BE NECESSARY AND THAT IT WAS THEREFORE URGENT THAT THE TURBINE CONTRACT FOR THE WEBBERS FALLS PROJECT BE AWARDED AS SOON AS POSSIBLE SO AS NOT TO DELAY THE PLANS AND SPECIFICATIONS FOR THE FIRST STAGE CONSTRUCTION OF THE WEBBERS FALLS POWERHOUSE. IN THE LIGHT OF SUCH STATEMENTS, WE ARE UNABLE TO CONCLUDE THAT THE AWARD, WHICH WAS APPROVED AND DOCUMENTED AS REQUIRED BY ASPR 2- 407.9 (B) (2) AND (3), WAS NOT A PROPER EXERCISE OF ADMINISTRATIVE AUTHORITY.

FOR THE REASONS STATED, WE FIND NO LEGAL BASIS TO QUESTION THE AWARD TO ALLIS-CHALMERS, AND THEREFORE YOUR PROTEST IS DENIED.