B-164229, JUL. 30, 1968

B-164229: Jul 30, 1968

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TO RACK ENGINEERING COMPANY: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF MAY 6 AND MAY 8. REFERENCE IS ALSO MADE TO LETTER DATED JUNE 29. THE BIDDERS WERE ADVISED ON PAGE 4 OF THE INVITATION THAT ALTHOUGH DELIVERY WAS REQUIRED WITHIN 60 DAYS AFTER RECEIPT OF THE CONTRACT. TWO BIDS WERE RECEIVED AND OPENED ON MARCH 25. YOUR BID WAS IN THE AMOUNT OF $64. 230.59 AND THE BID OF VIDMAR WAS IN THE AMOUNT OF $68. IT IS REPORTED THAT ENGINEERING ANALYSES SHOWED THAT THE SAMPLE CABINETS SUBMITTED BY YOU AND VIDMAR MET THE INVITATION PERFORMANCE SPECIFICATIONS. THE ANALYSES ALSO REVEALED AN AMBIGUITY IN THE SPECIFICATIONS IN THAT PARAGRAPH 1.2 ON PAGE 6 OF THE INVITATION WAS INCONSISTENT AND AMBIGUOUS IN RELATION TO THE PROVISIONS OF PARAGRAPHS 2.1.1 AND 2.1.3 OF THAT PAGE.

B-164229, JUL. 30, 1968

TO RACK ENGINEERING COMPANY:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF MAY 6 AND MAY 8, 1968, RESPECTIVELY, PROTESTING THE CANCELLATION OF INVITATION FOR BIDS NO. HM-68-7, ISSUED BY THE BUREAU OF THE MINT, TREASURY DEPARTMENT, ON MARCH 11, 1968. REFERENCE IS ALSO MADE TO LETTER DATED JUNE 29, 1968, FROM YOUR ATTORNEYS, COLDREN AND ADAMS, PROTESTING AGAINST THE AWARD OF A CONTRACT TO VIDMAR STORAGE SYSTEMS, DIVISION OF VOLKERT STAMPINGS, INC. (VIDMAR).

THE SUBJECT INVITATION REQUESTED BIDS FOR TOOL STORAGE CABINETS AND RELATED EQUIPMENT TO BE USED IN CONSTRUCTING, FURNISHING AND EQUIPPING THE NEW MINT BUILDING IN PHILADELPHIA, PENNSYLVANIA. THE BIDDERS WERE ADVISED ON PAGE 4 OF THE INVITATION THAT ALTHOUGH DELIVERY WAS REQUIRED WITHIN 60 DAYS AFTER RECEIPT OF THE CONTRACT, THE GOVERNMENT DESIRED DELIVERY AS EARLY AS POSSIBLE WITH PARTIAL DELIVERIES STARTING WITHIN 30 DAYS AFTER RECEIPT OF THE CONTRACT. THE INVITATION ALSO PROVIDED ON PAGE 4 THAT EACH BIDDER MUST SHIP ONE PREAWARD SAMPLE TOOL STORAGE CABINET MEETING ITEM 1 SPECIFICATIONS AT ITS OWN EXPENSE TO THE PHILADELPHIA MINT BY MARCH 27, 1968.

TWO BIDS WERE RECEIVED AND OPENED ON MARCH 25, 1968. YOUR BID WAS IN THE AMOUNT OF $64,230.59 AND THE BID OF VIDMAR WAS IN THE AMOUNT OF $68,831.59. IT IS REPORTED THAT ENGINEERING ANALYSES SHOWED THAT THE SAMPLE CABINETS SUBMITTED BY YOU AND VIDMAR MET THE INVITATION PERFORMANCE SPECIFICATIONS. HOWEVER, THE ANALYSES ALSO REVEALED AN AMBIGUITY IN THE SPECIFICATIONS IN THAT PARAGRAPH 1.2 ON PAGE 6 OF THE INVITATION WAS INCONSISTENT AND AMBIGUOUS IN RELATION TO THE PROVISIONS OF PARAGRAPHS 2.1.1 AND 2.1.3 OF THAT PAGE. IT IS FURTHER REPORTED THAT THE AMBIGUITY IN THE SPECIFICATIONS MADE YOUR BID NONRESPONSIVE EVEN THOUGH THE INVITATION DESCRIBED THE CABINETS REQUIRED BY CITING YOUR MODEL NUMBER OR EQUAL. CONSEQUENTLY, YOUR BID COULD NOT HAVE BEEN CONSIDERED AS RESPONSIVE AND BY NECESSITY WOULD HAVE BEEN REJECTED. ACCORDINGLY, THE DIRECTOR OF THE MINT PREPARED A DETERMINATION AND FINDINGS DATED APRIL 12, 1968, REJECTING ALL BIDS AND CANCELLING THE INVITATION IN ACCORDANCE WITH THE AUTHORITY OF SECTION 1-2.404-1 (B) (1) OF THE FEDERAL PROCUREMENT REGULATIONS, WHICH SPECIFICALLY PROVIDES THAT INVITATIONS MAY BE CANCELLED AFTER OPENING WHERE INADEQUATE, AMBIGUOUS, OR OTHERWISE DEFICIENT SPECIFICATIONS WERE CITED IN THE INVITATION FOR BIDS.

THEREAFTER, BECAUSE THE CABINETS WERE URGENTLY NEEDED THE DIRECTOR OF THE MINT DETERMINED THAT THE CABINETS SHOULD BE PROCURED BY NEGOTIATION BECAUSE THE PUBLIC EXIGENCY WOULD NOT ADMIT OF THE DELAY INCIDENT TO ADVERTISING. THE PROCUREMENT WAS MADE PURSUANT TO THE AUTHORITY OF SECTION 103 OF THE COINAGE ACT OF 1965, 79 STAT. 254, 255, 31 U.S.C. 393 (SUPP. 1967), AND 41 U.S.C. 252 (C) (15).

THE CITED COINAGE ACT OF 1965 EMPOWERS THE SECRETARY OF THE TREASURY TO ENTER INTO CONTRACTS UPON SUCH TERMS AND CONDITIONS AS HE MAY DEEM APPROPRIATE AND IN THE PUBLIC INTEREST, AND HE IS AUTHORIZED TO EXERCISE SUCH AUTHORITY WITHOUT REGARD TO ANY OTHER PROVISIONS OF LAW GOVERNING PROCUREMENT OR PUBLIC CONTRACTS. 41 U.S.C. 252 (C) (15) PROVIDES THAT PURCHASES AND CONTRACTS MAY BE NEGOTIATED WITHOUT FORMAL ADVERTISING IF OTHERWISE AUTHORIZED BY LAW. TREASURY DEPARTMENT ORDER NO. 205, DATED MARCH 29, 1967, DELEGATED TO THE DIRECTOR OF THE MINT, WITHOUT LIMITATION, ALL OF THE AUTHORITY GRANTED TO THE SECRETARY UNDER THE ABOVE-CITED PROVISIONS OF THE COINAGE ACT OF 1965.

IN CANCELLING THE INVITATION THE DIRECTOR OF THE MINT MERELY EXERCISED THE AUTHORITY SET FORTH IN 41 U.S.C. 253 (B) TO REJECT ALL BIDS WHEN DETERMINED TO BE IN THE PUBLIC INTEREST. A LOW BIDDER DOES NOT ACQUIRE AN ABSOLUTE RIGHT TO AWARD OF PUBLIC BUSINESS; RATHER THE PUBLIC INTEREST IS OF PRIMARY CONSIDERATION IN THE LETTING OF CONTRACTS. 26 COMP. GEN. 49, 50. IT CONSISTENTLY HAS BEEN HELD THAT AN INVITATION FOR BIDS DOES NOT IMPORT THE OBLIGATION TO ACCEPT ANY OF THE OFFERS RECEIVED. COLORADO PAVING COMPANY V MURPHY, 78 F.28 (1897); O-BRIEN V CARNEY, 6 F.SUPP. 761 (1934); SEE ALSO OUR DECISIONS AT 42 COMP. GEN. 467, 474; 37 ID. 760; 17 ID. 554, 559. MOREOVER, THE EXERCISE OF THE ADMINISTRATIVE AUTHORITY TO REJECT ALL BIDS IS NOT ORDINARILY SUBJECT TO REVIEW BY THE COURTS OR OUR OFFICE. SEE 41 COMP. GEN. 709, 711.

FURTHERMORE, IT IS OUR VIEW THAT THE LAW AUTHORIZES THE ABANDONMENT OF FORMAL ADVERTISING PROCEDURES AT ANY STAGE IN ORDER TO HASTEN THE FULFILLMENT OF THE GOVERNMENT'S REQUIREMENTS BY MEANS OF NEGOTIATION WHEN THE USE OF FORMAL ADVERTISING HAS CEASED TO BE EITHER FEASIBLE OR PRACTICABLE BECAUSE THE PUBLIC EXIGENCY WILL NOT PERMIT THE DELAY INCIDENT THERETO. SEE 41 U.S.C. 252 (C) (2). SEE ALSO OUR DECISION PUBLISHED AT 38 COMP. GEN. 44 WHERE WE UPHELD A DETERMINATION TO ABANDON THE USE OF FORMAL ADVERTISING AND THE NEGOTIATION OF THE REQUIREMENT ON THE GROUND OF PUBLIC EXIGENCY.

IN THE INSTANT CASE BOTH BIDDERS UNDER THE CITED INVITATION WERE AFFORDED AN OPPORTUNITY TO SUBMIT QUOTATIONS FOR PURPOSE OF NEGOTIATION. IN VIEW THEREOF, AND SINCE UNDER THE ABOVE-CITED PROVISIONS OF LAW THERE CAN BE NO QUESTION FROM A PURELY LEGAL STANDPOINT AS TO THE AUTHORITY OF THE DIRECTOR OF THE MINT TO REJECT THE BIDS AND NEGOTIATE A CONTRACT, WE SEE NO LEGAL BASIS FOR QUESTIONING THE AWARD OF THE CONTRACT TO VIDMAR.