B-162127, NOV. 8, 1967

B-162127: Nov 8, 1967

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ALL SUPPLIES HAVE BEEN DELIVERED AND PAYMENT MADE. ADMINISTRATIVE OFFICER WILL ATTEMPT TO PRESENT IRREGULARITIES IN FUTURE. INC.: REFERENCE IS MADE TO YOUR LETTER OF JULY 21. THE GENERAL SERVICES ADMINISTRATION ADVISED US THAT ITS REVIEW OF THE INSTANT PROCUREMENT INDICATED THAT THE SUBJECT CONTRACT WAS AWARDED INVALIDLY. THE CONTRACT WAS NEGOTIATED WITHOUT LEGAL AUTHORITY. THE PROCUREMENT WAS TREATED BASICALLY AS A SMALL PURCHASE AND HANDLED PURSUANT TO SUBPART 1-3.6 OF THE FEDERAL PROCUREMENT REGULATIONS AND IMPLEMENTING GSA REGULATIONS. THE USE OF THESE PROCEDURES WAS ERRONEOUS SINCE THE ESTIMATED VALUE OF THE PROCUREMENT EXCEEDED $2. IT IS POSSIBLE. THAT NEGOTIATION COULD HAVE BEEN CONDUCTED UNDER THE AUTHORITY SET FORTH IN SECTION 1-3.202 OF FPR SINCE THE SUPPLIES WERE URGENTLY REQUIRED.

B-162127, NOV. 8, 1967

CONTRACTS - AWARDS - IMPROPER DECISION TO CHICAGO TRANSPARENT, INC. PROTESTING NEGOTIATED AWARD BY GSA TO A HIGHER BIDDER BASED UPON EARLIER DELIVERY. ALTHOUGH ADMINISTRATIVE REPORT ON PROTEST TO A NEGOTIATED AWARD TO A HIGHER BIDDER ON BASIS OF EARLIER DELIVERY HAS MERIT, ALL SUPPLIES HAVE BEEN DELIVERED AND PAYMENT MADE. THEREFORE, TRANSACTION AS CONSUMMATED MAY NOT BE DISTURBED. HOWEVER, ADMINISTRATIVE OFFICER WILL ATTEMPT TO PRESENT IRREGULARITIES IN FUTURE.

TO CHICAGO TRANSPARENT, INC.:

REFERENCE IS MADE TO YOUR LETTER OF JULY 21, 1967, IN WHICH YOU PROTESTED THE AWARD OF A CONTRACT TO AMERICAN TRANSPARENT PLASTIC CORPORATION UNDER REQUEST FOR BID ON CASE FILE NUMBER GSA-NY-UW0942 DD2, ISSUED BY THE GENERAL SERVICES ADMINISTRATION, 30 CHURCH STREET, NEW YORK, NEW YORK.

IN A REPORT DATED OCTOBER 24, 1967, THE GENERAL SERVICES ADMINISTRATION ADVISED US THAT ITS REVIEW OF THE INSTANT PROCUREMENT INDICATED THAT THE SUBJECT CONTRACT WAS AWARDED INVALIDLY, AS FOLLOWS: "FIRST, THE CONTRACT WAS NEGOTIATED WITHOUT LEGAL AUTHORITY. THE PROCUREMENT WAS TREATED BASICALLY AS A SMALL PURCHASE AND HANDLED PURSUANT TO SUBPART 1-3.6 OF THE FEDERAL PROCUREMENT REGULATIONS AND IMPLEMENTING GSA REGULATIONS. THE USE OF THESE PROCEDURES WAS ERRONEOUS SINCE THE ESTIMATED VALUE OF THE PROCUREMENT EXCEEDED $2,500. IT IS POSSIBLE, OF COURSE, THAT NEGOTIATION COULD HAVE BEEN CONDUCTED UNDER THE AUTHORITY SET FORTH IN SECTION 1-3.202 OF FPR SINCE THE SUPPLIES WERE URGENTLY REQUIRED. HOWEVER, THIS WAS NOT THE AUTHORITY CITED AND NO FINDINGS AND DETERMINATION JUSTIFYING THE USE OF THIS NEGOTIATION AUTHORITY WAS EVER PREPARED IN ACCORDANCE WITH THE REQUIREMENTS OF SECTION 1-3.306 OF FPR. "SECONDLY, THE NEGOTIATIONS WHICH WERE CONDUCTED WERE IMPROPERLY HANDLED. THE REQUEST MADE TO CHICAGO TRANSPARENT FOR REVISED PRICES BASED ON EARLIER DELIVERY SHOULD NOT HAVE BEEN LIMITED TO THE TWO ITEMS ON WHICH IT WAS LOW. ALTHOUGH IT IS DOUBTFUL THAT THIS WOULD HAVE AFFECTED THE RESULT IT SHOULD HAVE BEEN MADE CLEAR THAT THE BIDDER WAS BEING GIVEN AN OPPORTUNITY TO REVISE ITS ENTIRE PROPOSAL. AT THIS POINT IN TIME IT IS DIFFICULT TO RECONSTRUCT EXACTLY WHAT IMPRESSION WAS LEFT WITH THE BIDDER AS TO OUR REQUIREMENTS FOR THE OTHER ITEMS. IN ADDITION, SINCE A 10-DAY DELIVERY MET THE MINIMUM NEEDS OF THE GOVERNMENT IT IS POSSIBLE THAT FURTHER NEGOTIATION WITH AMERICAN, WHICH OFFERED ONE WEEK DELIVERY, COULD HAVE RESULTED IN LOWER OVERALL PRICES. "FINALLY, IT IS QUESTIONABLE WHETHER WE WERE CORRECT IN NOT OFFERING NATIONAL TRANSPARENT CO. ANY OPPORTUNITY TO AMEND ITS PROPOSAL AFTER ITS INITIAL SUBMISSION. IT CAN, OF COURSE, BE ARGUED THAT THE NATIONAL OFFER WAS SO HIGH IN PRICE AS TO BE OUTSIDE THE -COMPETITIVE RANGE.- CONSIDERATION, HOWEVER, SHOULD HAVE BEEN GIVEN TO THE REQUIREMENTS OF SECTION 1-3.805-1 OF FPR.'

IN VIEW OF THE FOREGOING IT WOULD APPEAR THAT YOUR PROTEST AGAINST AWARD TO A HIGHER BIDDER, BASED UPON EARLIER DELIVERY, HAS MERIT. HOWEVER, ALL OF THE SUPPLIES TO BE DELIVERED UNDER THE CONTRACT WERE FURNISHED BEFORE THE DATE OF YOUR PROTEST, HAVE BEEN USED FOR THE PURPOSE FOR WHICH THEY WERE PROCURED, AND PAYMENT HAS BEEN MADE. ADDITIONALLY, WE ARE ADVISED THAT THE PRICES PAID ON THE AWARDED CONTRACT WERE REASONABLE AND THE LOWEST OFFERED FOR 10 DAY DELIVERY.

UNDER THESE CIRCUMSTANCES WE SEE NO ALTERNATIVE BUT TO ALLOW THE TRANSACTION TO STAND AS CONSUMMATED; HOWEVER, THE GENERAL SERVICES ADMINISTRATION HAS NOTIFIED THE INVOLVED PERSONNEL OF THE IRREGULARITIES NOTED AND WILL ATTEMPT TO PREVENT THEIR RECURRENCE.