B-165025, OCT. 17, 1968

B-165025, OCT. 17, 1968

TO MCCLURE AND TROTTER:

WE REFER TO YOUR LETTER DATED AUGUST 8, 1968, ON BEHALF OF GENERAL STEEL TANK COMPANY, INC., (GENERAL STEEL), PROTESTING AGAINST CANCELLATION OF INVITATION FOR BIDS (IFB) NO. DSA 700-68-B-2868 BY THE DEFENSE CONSTRUCTION SUPPLY CENTER, (DCSC), COLUMBUS, OHIO. BY YOUR SUPPLEMENTAL LETTER OF AUGUST 13, 1968, YOU PRESENTED FURTHER COMPLAINTS AGAINST CERTAIN ACTIONS OF THE DCSC UNDER REQUESTS FOR PROPOSALS (RFP) NO. DSA 700 -68-R-1149 AND NO. DSA 700-68-R-4753.

THE SUBJECT IFB WAS ISSUED ON APRIL 3, 1968, AND CALLED FOR FREIGHT PREPAID DELIVERY TO TWO DESTINATIONS OF A TOTAL OF 130PORT FUEL TANKS AND 137 STARBOARD FUEL TANKS, TO BE MANUFACTURED IN ACCORDANCE WITH THE NAVY DEPARTMENT, BUREAU OF SHIPS, DRAWING NOS. 8967 AND 8901. DRAWING NO. 8967 COVERS THE PORT AND STARBOARD FUEL TANKS, WHILE DRAWING NO. 8901 PRESCRIBES FITTINGS FOR THESE TANKS. SEVEN BIDS WERE RECEIVED AND OPENED ON MAY 17, 1968. GENERAL STEEL'S BID OF UNIT PRICES OF $196 AND $198 FOR THE TWO DESTINATIONS WAS THE LOWEST.

DURING THE PRE-AWARD SURVEY OF GENERAL STEEL, THE QUESTION WAS RAISED WHETHER THE PROCUREMENT CALLED FOR ONLY THE FUEL TANKS OR THE FUEL TANKS WITH FITTINGS. THE DCSC WAS ADVISED BY THE REQUISITIONING ACTIVITY THAT ONLY THE TANKS WERE REQUIRED; CONSEQUENTLY, IT APPEARED THAT THE PURCHASE DESCRIPTION CITATION OF DRAWING NO. 8901 WAS ERRONEOUS. IN ADDITION, THE REQUIRING ACTIVITY RE-EXAMINED ITS REQUIREMENTS, AND CONCLUDED THAT ONLY 24 PORT FUEL TANKS AND 43 STARBOARD FUEL TANKS OF THE TYPE PRESCRIBED IN DRAWING NO. 8967 WERE NEEDED AT THIS TIME. ON JULY 17, 1968, THE SUBJECT INVITATION WAS CANCELLED, AND A NEW INVITATION, NO. DSA 700-69-B-0328, WAS ISSUED ON AUGUST 12, 1968, FOR THE REDUCED TOTAL QUANTITY OF 67 FUEL TANKS, WHICH CITED ONLY DRAWING NO. 8967.

YOUR PROTEST CHALLENGES THE LEGALITY OF THE CANCELLATION, AFTER BID OPENING, OF INVITATION NO. DSA 700-68-B-2868, ON THE GROUND THAT THE CANCELLATION WAS CONTRARY TO THE APPLICABLE SECTIONS OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR).

YOUR ATTENTION IS INVITED TO ASPR 2-404.1, WHICH PROVIDES IN PERTINENT PART, AS FOLLOWS:

"/A) THE 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 * *

"/B) * * * INVITATIONS FOR BIDS MAY BE CANCELED AFTER OPENING BUT PRIOR TO AWARD WHERE SUCH ACTION IS CONSISTENT WITH (A) ABOVE AND THE CONTRACTING OFFICER DETERMINES IN WRITING THAT --

(I) INADEQUATE AND AMBIGUOUS SPECIFICATIONS WERE CITED IN THE INVITATION;

(III) THE SUPPLIES OR SERVICES BEING PROCURED ARE NO LONGER REQUIRED; * *

MOREOVER, STANDARD FORM 33A, INCORPORATED BY REFERENCE IN THE IFB, EXPRESSLY RESERVES TO THE GOVERNMENT THE RIGHT TO REJECT ANY AND ALL BIDS RECEIVED UNDER THE INVITATION, AND THE CONTROLLING STATUTE, 10 U.S.C. 2305 (C), SPECIFICALLY AUTHORIZES REJECTION OF ALL BIDS IF SUCH ACTION IS DETERMINED BY THE HEAD OF THE AGENCY THAT SUCH ACTION IS IN THE INTEREST OF THE GOVERNMENT.

WE HAVE FREQUENTLY HELD THAT CANCELLATION OF AN INVITATION AFTER BID OPENING IS LEGALLY JUSTIFIED IF THE PARTICULAR INVITATION INCLUDES INADEQUATE OR AMBIGUOUS SPECIFICATIONS. SEE B-154415, AUGUST 4, 1964; B- 157692, NOVEMBER 2, 1965; B-163030, FEBRUARY 8, 1968. THE RESPONSIBILITY FOR SUCH ACTION RESTS PRIMARILY WITH THE CONTRACTING OFFICER, AND IN THE ABSENCE OF ABUSE OF HIS DISCRETIONARY POWERS, OUR OFFICE WILL NOT OBJECT THERETO. SEE B-159287, JULY 26, 1966; B-161877, AUGUST 8, 1967. IN THE INSTANT MATTER, IT IS CLEAR THAT THE INVITATION WAS ERRONEOUS BECAUSE THE PURCHASE DESCRIPTION, WHICH CITED DRAWING NO. 8901, CALLED FOR FUEL TANK FITTINGS WHICH WERE NOT REQUIRED, AND THEREFORE WAS IN EXCESS OF THE ACTUAL NEEDS OF THE GOVERNMENT. UNDER THESE CIRCUMSTANCES, WE MUST CONCUR WITH THE CONTRACTING OFFICER'S DETERMINATION TO CANCEL THE INVITATION.

IN ADDITION, IT IS THE POSITION OF OUR OFFICE THAT CANCELLATION IS PROPER WHEN THERE IS A SUBSEQUENT DETERMINATION THAT REQUIRES A MATERIAL REDUCTION IN QUANTITY FOR THE PROCUREMENT OF AN ITEM. SEE B 153229, FEBRUARY 5, 1964; B-162914, JANUARY 30, 1968.

SINCE IFB NO. DSA 700-68-B-2868 DID NOT PROPERLY STATE THE ACTUAL NEEDS OF THE GOVERNMENT, WE MUST CONCUR WITH THE CONTRACTING OFFICER'S DETERMINATION TO CANCEL THE SUBJECT IFB, AND YOUR PROTEST AGAINST THAT ACTION IS DENIED.

IN YOUR LETTER OF AUGUST 13, 1968, YOU COMPLAIN OF THE ALLEGED FAILURE OF THE CONTRACTING OFFICER TO CLARIFY A POSSIBLE DISCREPANCY UNDER RFP NOS. DSA 700-68-R-1149 AND DSA 700-68-R-4753. YOU CONTEND THAT THE CONTRACTING OFFICER GAVE CONFLICTING ADVICES TO GENERAL STEEL CONCERNING THE REQUIREMENTS OF MANHOLES FOR THE RELAXATION CHAMBERS SOUGHT TO BE PROCURED UNDER THE SUBJECT RFPS, AND DID NOT CLARIFY THE MATTER BEFORE AWARD OF A CONTRACT TO IT UNDER THE LATTER SOLICITATION. IN VIEW OF THE FACT THAT GENERAL STEEL, UNDER THE DISPUTES ARTICLE OF CONTRACT NO. DSA 700-68-C- 9606, IS CONTESTING THE CONTRACTING OFFICER'S RULING, OUR OFFICE IS NOT IN A POSITION TO CONSIDER THIS MATTER PENDING FINAL ADMINISTRATIVE DECISION. WITH RESPECT TO THE REPORTED FAILURE OF GENERAL STEEL TO RECEIVE THE AMENDMENTS EXTENDING THE TIME FOR SUBMISSION OF PROPOSALS UNDER RFP NO. DSA 700-68-R-1149, THE PROCURING ACTIVITY REPORTS THAT ITS RECORDS SHOW MAILING THEREOF. THE FAILURE TO RECEIVE THE AMENDMENTS THEREFORE CANNOT BE ACCEPTED AS ESTABLISHING ANY IMPROPER ACTION OR BIAS OR PREJUDICE ON THE PART OF THE CONTRACTING OFFICIALS.