B-163359, APR. 11, 1968

B-163359: Apr 11, 1968

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INC.: FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 18. THE ABOVE IFB WAS FOR A REQUIREMENTS CONTRACT FOR METAL CUTTING HAND SHEARS FOR THE PERIOD FROM APRIL 1. WHICHEVER IS LATER. THE INVITATION COVERED 11 ITEMS OF SHEARS AND BIDS WERE OPENED ON DECEMBER 12. GSA REPORTS THAT WHEN THE INVITATION WAS ISSUED THE CONTRACTING OFFICER INADVERTENTLY HAD COPIES SENT TO THOSE PERSONS AND FIRMS LISTED ON MAILING LIST 51-140 (SHEARS AND SCISSORS. YOUR REQUEST FOR CANCELLATION OF THE IFB IS BASED ON THE FACT THAT YOU DID NOT RECEIVE A COPY OF THE INVITATION. WOULD HAVE RECEIVED ONE IF THE CORRECT MAILING LIST HAD BEEN USED. WHICH IS A UNIFORM STANDARD LIST COVERING ALL ARTICLES OF SUPPLY NORMALLY PURCHASED BY THE FEDERAL SUPPLY SERVICE AND WHICH IS PROVIDED PRIMARILY FOR USE IN CONNECTION WITH FILING OF BIDDERS' MAILING LIST APPLICATIONS.

B-163359, APR. 11, 1968

TO HARDWARE AND INDUSTRIAL TOOL COMPANY, INC.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF JANUARY 18, 1968, REQUESTING READVERTISEMENT OF A PROCUREMENT BY THE GENERAL SERVICES ADMINISTRATION, FEDERAL SUPPLY SERVICE, UNDER INVITATION FOR BIDS (IFB) NO. FPNTP-A7-56450 -A-12-12-67.

THE ABOVE IFB WAS FOR A REQUIREMENTS CONTRACT FOR METAL CUTTING HAND SHEARS FOR THE PERIOD FROM APRIL 1, 1968, OR DATE OF AWARD, WHICHEVER IS LATER, THROUGH MARCH 31, 1969. THE INVITATION COVERED 11 ITEMS OF SHEARS AND BIDS WERE OPENED ON DECEMBER 12, 1967. HOWEVER, GSA REPORTS THAT WHEN THE INVITATION WAS ISSUED THE CONTRACTING OFFICER INADVERTENTLY HAD COPIES SENT TO THOSE PERSONS AND FIRMS LISTED ON MAILING LIST 51-140 (SHEARS AND SCISSORS, GENERAL PURPOSE) INSTEAD OF TO THE ADDRESSEES ON MAILING LIST 51 -141 (SHEARS, METAL CUTTING, HAND), AND YOUR REQUEST FOR CANCELLATION OF THE IFB IS BASED ON THE FACT THAT YOU DID NOT RECEIVE A COPY OF THE INVITATION, BUT WOULD HAVE RECEIVED ONE IF THE CORRECT MAILING LIST HAD BEEN USED. YOU FURTHER STATE THAT 41 CFR 1-2.205 PROVIDES THAT A BIDDER'S LIST BE KEPT IN EVERY CATEGORY AND YOU CITE OUR DECISION OF MARCH 28, 1967, B 160975, IN SUPPORT OF YOUR PROTEST.

GSA PUBLISHES A "LIST OF COMMODITIES," FORM 1382, WHICH IS A UNIFORM STANDARD LIST COVERING ALL ARTICLES OF SUPPLY NORMALLY PURCHASED BY THE FEDERAL SUPPLY SERVICE AND WHICH IS PROVIDED PRIMARILY FOR USE IN CONNECTION WITH FILING OF BIDDERS' MAILING LIST APPLICATIONS. THIS ENCOMPASSES APPROXIMATELY 135 GROUPS OF COMMODITIES, EACH OF WHICH IS FURTHER BROKEN DOWN INTO NUMEROUS MORE DEFINITIVE SUB-GROUPS. GROUP 51 "HAND TOOLS" HAS MORE THAN 200 MAILING LIST CODE NUMBERS. FOUR OF THESE PERTAIN TO MAILING LISTS OF PROSPECTIVE BIDDERS FOR VARIOUS TYPES OF SHEARS (CODES 140 THROUGH 143). IN VIEW OF THE LARGE NUMBER OF SUB-LISTS AND THE HEAVY WORKLOAD OF PROCUREMENT PERSONNEL, AN OCCASIONAL ERROR WILL INEVITABLY RESULT. HOWEVER, GSA REPORTS THAT LIST 51-140, WHICH WAS USED IN ERROR, INCLUDES ALL PREVIOUS BIDDERS ON THE ITEMS SET FORTH IN THE CURRENT INVITATION, WITH THE EXCEPTION OF HITCO. IT IS FURTHER REPORTED THAT THE PROCUREMENT WAS SYNOPSIZED AND PUBLISHED IN THE COMMERCE BUSINESS DAILY ON NOVEMBER 24, 1967, IN ACCORDANCE WITH SECTION 1-2.203-4 OF THE FEDERAL PROCUREMENT REGULATIONS (FPR).

FPR 1-2.404-1 (A) PROVIDES, IN PERTINENT PART, THAT "PRESERVATION OF THE INTEGRITY OF THE COMPETITIVE BID SYSTEM DICTATES THAT, AFTER BIDS HAVE BEEN OPENED, AWARD MUST BE MADE TO THAT RESPONSIBLE BIDDER WHO SUBMITTED THE LOWEST RESPONSIVE BID, UNLESS THERE IS A COMPELLING REASON TO REJECT ALL BIDS AND CANCEL THE INVITATION.' THE REASONABLENESS OF THIS REGULATION IS APPARENT WHEN IT IS RECOGNIZED THAT READVERTISEMENT AFTER BID OPENING TURNS THE PROCUREMENT INTO A GUESSING GAME IN WHICH THE BIDDERS ATTEMPT TO ANTICIPATE HOW MUCH, IF ANY, THEIR COMPETITORS WILL REDUCE THEIR ORIGINAL PRICES. WHILE THIS MIGHT REDOUND TO THE BENEFIT OF THE GOVERNMENT IN THE FORM OF LOWER PRICES, IT IS MOST UNFAIR TO THE LOW ACCEPTABLE BIDDER UNDER THE ORIGINAL INVITATION AND CLEARLY IS NOT DESIRABLE. THE PROCURING AGENCIES ARE THEREFORE LOATHE TO CANCEL AND READVERTISE UNLESS SUCH ACTION IS VIRTUALLY UNAVOIDABLE, AND THE DECISIONS OF THIS OFFICE HAVE CONSISTENTLY SUPPORTED THIS APPROACH. SEE 39 COMP. GEN. 396; B-161208, AUGUST 8, 1967.

FPR 1-2.404-1 (B) READS AS FOLLOWS:

"INVITATIONS FOR BIDS MAY BE CANCELLED AFTER OPENING BUT PRIOR TO AWARD, AND ALL BIDS REJECTED, WHERE SUCH ACTION IS CONSISTENT WITH SEC. 1-2.404-1 (A) AND THE CONTRACTING OFFICER DETERMINES IN WRITING THAT CANCELLATION IS IN THE BEST INTEREST OF THE GOVERNMENT FOR REASONS SUCH AS THE FOLLOWING:

(1) INADEQUATE, AMBIGUOUS, OR OTHERWISE DEFICIENT SPECIFICATIONS WERE CITED IN THE INVITATION FOR BIDS.

(2) THE SUPPLIES OR SERVICES ARE NO LONGER REQUIRED.

(3) THE INVITATIONS FOR BIDS DID NOT PROVIDE FOR CONSIDERATION OF ALL FACTORS OF COST TO THE GOVERNMENT, SUCH AS COST OF TRANSPORTING GOVERNMENT -FURNISHED PROPERTY TO BIDDERS' PLANTS.

(4) BIDS RECEIVED INDICATE THAT THE NEEDS OF THE GOVERNMENT CAN BE SATISFIED BY A LESS EXPENSIVE ARTICLE DIFFERING FROM THAT ON WHICH THE BIDS WERE INVITED.

(5) ALL OTHERWISE ACCEPTABLE BIDS RECEIVED ARE AT UNREASONABLE PRICES. (SEE SEC. 1-3.214 CONCERNING AUTHORITY TO NEGOTIATE IN SUCH SITUATIONS.)

(6) THE BIDS WERE NOT INDEPENDENTLY ARRIVED AT IN OPEN COMPETITION, WERE COLLUSIVE, OR WERE SUBMITTED IN BAD FAITH. (SEE SEC. 1-3.214 CONCERNING AUTHORITY TO NEGOTIATE IN SUCH SITUATIONS AND SUB-PART 1 1.9 FOR REPORTS TO BE MADE TO THE DEPARTMENT OF JUSTICE.)

(7) THE BIDS RECEIVED DID NOT PROVIDE COMPETITION WHICH WAS ADEQUATE TO INSURE REASONABLE PRICES.'

THE LISTED BASES FOR CANCELLATION ARE NOT INTENDED TO BE ALL INCLUSIVE, BUT ARE INDICATIVE OF THE TYPE OF CIRCUMSTANCE WHICH JUSTIFIES SUCH ACTION. IN THE PRESENT CASE IT APPEARS THAT ONLY (5) OR (7) MIGHT BE APPLICABLE, IF IT COULD BE ESTABLISHED THAT THERE WAS INADEQUATE COMPETITION AND/OR THAT PRICES WERE NOT REASONABLE. AS STATED ABOVE, HITCO WAS THE ONLY PREVIOUS BIDDER ON THE INVOLVED ITEMS WHO FAILED TO APPEAR ON BOTH LISTS, AND GSA STATES THAT WHILE IT REGRETS THE ERROR WHICH RESULTED IN YOUR FAILURE TO RECEIVE A COPY OF THE INVITATION AND WILL ENDEAVOR TO PREVENT A REOCCURRENCE, THERE WAS IN FACT ADEQUATE COMPETITION AND THE LOW BIDS ARE CONSIDERED TO BE REASONABLE. WITH RESPECT TO THOSE ITEMS ON WHICH YOU HAD PREVIOUSLY BID, IT IS REPORTED THAT THE LOW BID WAS 2.08 PERCENT ABOVE THE CURRENT CONTRACT PRICE.

AS INDICATED BY YOU, 41 CFR 1-2.205-1 PROVIDES THAT MAILING LISTS SHALL BE ESTABLISHED BY PROCURING ACTIVITIES TO ASSURE ACCESS TO ADEQUATE SOURCES OF SUPPLY AND SERVICE. HOWEVER, 41 CFR 1-2.205-4, WHICH RELATES TO EXCESSIVELY LONG BIDDERS' MAILING LISTS, PROVIDES THAT TO PREVENT EXCESSIVE ADMINISTRATIVE COSTS OF A PROCUREMENT, MAILING LISTS SHOULD BE USED IN A WAY WHICH WILL PROMOTE COMPETITION COMMENSURATE WITH THE DOLLAR VALUE OF THE PURCHASE TO BE MADE AND THAT AS MUCH OF THE MAILING LIST WILL BE USED AS IS COMPATIBLE WITH EFFICIENCY AND ECONOMY IN SECURING ADEQUATE COMPETITION AS REQUIRED BY LAW. SINCE THE REGULATIONS SPECIFICALLY AUTHORIZE THE USE BY DESIGN OF ONLY PARTS OF MAILING LISTS, WHEN JUSTIFIED BY THE CIRCUMSTANCES, IT SEEMS CLEAR THAT THE INADVERTENT FAILURE TO SOLICIT A BID FROM ONE PROSPECTIVE BIDDER COULD NOT BE CONSIDERED A SUFFICIENTLY COGENT REASON TO CANCEL THE INVITATION AND READVERTISE, WHERE ADEQUATE COMPETITION HAS BEEN SECURED. SEE 42 COMP. GEN. 36; 34 ID. 684.

IN THE CASE CONSIDERED IN OUR DECISION OF MARCH 28, 1967, B-160975, CITED BY YOU IN SUPPORT OF YOUR PROTEST, IT APPEARS THAT THE INITIAL INVITATION WAS ISSUED ONLY TO TWO FIRMS, THAT THE PROTESTOR WAS A CURRENT PRODUCER OF THE REQUIRED ITEM, PERFORMING SATISFACTORILY, AND THAT THE FAILURE TO SOLICIT THE PROTESTOR WAS DUE TO AN INADVERTENCE ON THE PART OF THE PROCURING AGENCY, BECAUSE OF AN ERRONEOUS IMPRESSION THAT THE PROTESTOR DID NOT WISH TO SUBMIT A BID. IT APPEARS FURTHER THAT THE ORIGINAL PROCUREMENT HAD NOT BEEN SYNOPSIZED IN THE COMMERCE BUSINESS DAILY AS GENERALLY REQUIRED BY SECTION 1 1003.1 (A) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) AND THAT THE FAILURE TO PUBLISH THE SYNOPSIS WAS PURSUANT TO THE EXCEPTION IN ASPR 1-1003.1 (C) (IV) WHICH PROVIDES THAT PUBLICATION IS NOT NECESSARY IF IT INVOLVES A "PROCUREMENT (WHETHER ADVERTISED OR NEGOTIATED) WHICH IS OF SUCH URGENCY THAT THE GOVERNMENT WOULD BE SERIOUSLY INJURED BY THE DELAY INVOLVED IN PERMITTING THE DATE SET FOR RECEIPT OF BIDS, PROPOSALS, OR QUOTATIONS TO BE MORE THAN 15 CALENDAR DAYS FROM THE DATE OF TRANSMITTAL OF THE SYNOPSIS OR THE DATE OF ISSUANCE OF THE SOLICITATION, WHICHEVER IS EARLIER.' SINCE THE ORIGINAL INVITATION WAS ISSUED JANUARY 19, 1967, AND THE READVERTISEMENT WAS ISSUED MARCH 6, 1967, REQUESTING BIDS TO BE OPENED MARCH 29, 1967, THE CONCLUSION SEEMS JUSTIFIED THAT THE URGENCY CONTEMPLATED BY THE QUOTED EXCEPTION DID NOT IN FACT EXIST. FROM THE FOREGOING IT APPEARS THAT THERE WAS SOME FAULT ON THE PART OF THE AGENCY IN NOT FOLLOWING THE REQUIRED PROCEDURE AND IN FAILING TO SOLICIT THE PROTESTOR, AND THAT THERE WAS NOT ADEQUATE COMPETITION. IN VIEW OF THE DIFFERING CIRCUMSTANCES, THE CITED DECISION MAY NOT BE CONSIDERED AS CONTROLLING UPON THE DISPOSITION OF YOUR COMPLAINT.

FOR THE REASONS STATED, WE CONCLUDE THAT GSA'S FAILURE TO CANCEL AND READVERTISE THE CURRENT PROCUREMENT WAS NOT IMPROPER, AND YOUR PROTEST IS THEREFORE DENIED.