B-166254, JUN. 5, 1969

B-166254: Jun 5, 1969

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HANNEBRINK: REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 17. WERE REQUESTED. ARMADILLO WAS AWARDED THE CONTRACT AS THE LOWEST BIDDER BASED ON A UNIT PRICE OF $4. THE CONTRACTOR HAS DELIVERED THE BUILDINGS WHICH HAVE BEEN ACCEPTED AND PLACED IN USE. BASED ON ESTIMATED WEIGHTS AND RATES WHEREAS THE ACTUAL FREIGHT CHARGES OF THE RAIL CARRIERS WERE $2. THE CONTRACTING OFFICER STATES THAT THERE WERE ONLY THREE BIDS RECEIVED AND THAT THE SECOND LOW BID WAS FOR A TOTAL OF $11. IF ARMADILLO IS PAID THE ADDITIONAL FREIGHT CHARGES CLAIMED. THE CONTRACTING OFFICER RECOMMENDS THAT PAYMENT BE ALLOWED IF THE FREIGHT CHARGES ARE DETERMINED TO BE THE LOWEST POSSIBLE FOR THE SHIPMENT. ALTHOUGH THE OFFER OF ARMADILLO WAS BASED ON ESTIMATED WEIGHTS AND RATES.

B-166254, JUN. 5, 1969

TO MRS. LILA B. HANNEBRINK:

REFERENCE IS MADE TO YOUR LETTER OF FEBRUARY 17, 1969, FILE (D-733B 2) REQUESTING A DECISION AS TO WHETHER YOU MAY PROPERLY CERTIFY FOR PAYMENT VOUCHER AND SCHEDULE OF PAYMENTS, SF-1166, SCHEDULE NUMBER D3300, IN THE AMOUNT OF $1,498 FOR ADDITIONAL TRANSPORTATION CHARGES UNDER CONTRACT NO. 14-11-0001-4266 WITH THE ARMADILLO MANUFACTURING COMPANY.

BY SOLICITATION NUMBER 2416, OFFERS ON SUPPLYING TWO PORTABLE BUILDINGS, ONE F.O.B. FAIRBANKS AND THE OTHER F.O.B. ANCHORAGE, ALASKA, WERE REQUESTED. ARMADILLO ANSWERED BY LETTER DATED JUNE 8, 1968 (QUOTATION NO. 508-400), ENCLOSING A PRICE SHEET WHICH INDICATED IT PROPOSED TO FURNISH THE BUILDINGS AT $4,154 EACH PLUS $60 PACKING AND LOADING COSTS APIECE, PLUS CERTAIN TRANSPORTATION COSTS, THE NOTATION AS TO SUCH COSTS READING:

"10. TRANSPORTATION: 10.1 VIA RAIL TO SEATTLE, WASH./FAIRBANKS AND ANCHORAGE $552.00 EA. ESTIMATED BASED ON ESTIMATED WEIGHTS AND RATES AS SUPPLIED BY LOCAL RAIL AGENT.' ARMADILLO WAS AWARDED THE CONTRACT AS THE LOWEST BIDDER BASED ON A UNIT PRICE OF $4,766 EACH, WHICH INCLUDED TRANSPORTATION CHARGES OF $552 EACH, OR A TOTAL PRICE FOR THE TWO BUILDINGS OF $9,532.

THE CONTRACTOR HAS DELIVERED THE BUILDINGS WHICH HAVE BEEN ACCEPTED AND PLACED IN USE. ALSO, IT HAS BEEN PAID THE SUM OF $9,532. HOWEVER, THE CONTRACTOR HAS NOW SUBMITTED A BILL SUPPORTED BY THE RAIL CARRIERS' FREIGHT BILLS FOR ADDITIONAL TRANSPORTATION CHARGES OF $1,498. THE ADDITIONAL AMOUNT REPRESENTS THE DIFFERENCE BETWEEN THE FREIGHT CHARGES OF $552 FOR EACH BUILDING (TOTAL $1,104), BASED ON ESTIMATED WEIGHTS AND RATES WHEREAS THE ACTUAL FREIGHT CHARGES OF THE RAIL CARRIERS WERE $2,602.

THE CONTRACTING OFFICER STATES THAT THERE WERE ONLY THREE BIDS RECEIVED AND THAT THE SECOND LOW BID WAS FOR A TOTAL OF $11,172. THUS, IF ARMADILLO IS PAID THE ADDITIONAL FREIGHT CHARGES CLAIMED, THE TOTAL COST WOULD BE $11,030 ($9,532 PLUS $1,498) OR STILL SOMEWHAT LESS THAN THE AMOUNT OF THE SECOND LOW BID. THE CONTRACTING OFFICER RECOMMENDS THAT PAYMENT BE ALLOWED IF THE FREIGHT CHARGES ARE DETERMINED TO BE THE LOWEST POSSIBLE FOR THE SHIPMENT.

ALTHOUGH THE OFFER OF ARMADILLO WAS BASED ON ESTIMATED WEIGHTS AND RATES, IT WAS INDICATED THAT RAIL SERVICE WOULD BE UTILIZED IN PERFORMANCE OF THE CONTRACT. THE ACTUAL WEIGHT OF EACH UNIT WAS LESS THAN THE TARIFF MINIMUM WEIGHT REQUIRED TO BE PROTECTED BY TARIFFS LAWFULLY ON FILE WITH THE INTERSTATE COMMERCE COMMISSION. THE FREIGHT CHARGES NOW CLAIMED, WHEN CONSIDERED WITH THOSE ALREADY PAID, ARE THE LOWEST APPLICABLE TO THE SHIPMENT. SINCE THE TOTAL CONTRACT PRICE IS STILL THE LOWEST OF THE THREE OFFERS AND IT DOES NOT APPEAR THAT ANY OF THE OTHER BIDDERS WERE HARMED BY THE ACCEPTANCE OF THE ESTIMATED BID BASED ON THE ESTIMATED FREIGHT CHARGES, IT WOULD APPEAR THAT THE BEST INTERESTS OF THE GOVERNMENT WOULD BE SERVED BY PAYMENT OF THE ADDITIONAL TRANSPORTATION CHARGES.

ACCORDINGLY, VOUCHER AND SCHEDULE OF PAYMENTS, SF-1166, SCHEDULE NUMBER D3300 IN THE AMOUNT OF $1,498 MAY BE CERTIFIED FOR PAYMENT.