B-166641, JUL. 3, 1969

B-166641: Jul 3, 1969

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FOUR BIDS WERE RECEIVED ON THE BID OPENING DATE. IT WAS DETERMINED THAT THE OTHER BIDS RECEIVED UNDER THE INVITATION WERE EXCESSIVE. 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: (5) ALL OTHERWISE ACCEPTABLE BIDS RECEIVED ARE AT UNREASONABLE PRICES.'. YOU MAINTAIN THAT SUCH ACTION WAS ERRONEOUSLY TAKEN AND CONTEND THAT YOUR BID OF $72. 733.00 WAS NOT EXCESSIVE FOR SEVERAL REASONS STATED IN A LETTER DATED MAY 27. OUR OFFICE HAS HELD THAT AS THE ADVERTISING STATUTES WERE ENACTED FOR THE PROTECTION OF THE GOVERNMENT. CONSISTENT WITH THE FOREGOING WE HAVE HELD THAT: "* * * WHEN IN THE LIGHT OF ALL THE FACTS.

B-166641, JUL. 3, 1969

TO BUILDING MAINTENANCE CORPORATION:

ON APRIL 8, 1969, YOU PROTESTED AGAINST AWARD TO ANY OTHER BIDDER UNDER INVITATION FOR BIDS (IFB) NO. 2PBO-RC-543, ISSUED BY REGION 2 OF THE GENERAL SERVICES ADMINISTRATION (GSA) ON MARCH 14, 1969, FOR FLOOR STRIPPING, WAXING AND BUFFING OF THE FLOORS AT THE FEDERAL BUILDING, PITTSBURG, PENNSYLVANIA, COMMENCING MAY 1, 1969. FOUR BIDS WERE RECEIVED ON THE BID OPENING DATE, APRIL 7, 1969, AS FOLLOWS:

ALLEGHENY CONTRACT MAINTENANCE CO. $37,500.00 P.A.

BUILDING MAINTENANCE CORPORATION $72,733.00 P.A.

ACME BUILDING SERVICE CO. $79,972.00 P.A.

GENERAL CLEANING CO. $91,500.00 P.A. YOU CONTENDED THAT THE LOW BID MUST BE REJECTED AS NONRESPONSIVE BECAUSE OF THE FOLLOWING STATEMENT ALLEGHENY INSERTED ON THE BID FORM AFTER ITS LUMP SUM PRICE ENTRY: "PROVIDING 1/3 OF THE BUILDING CAN BE STRIPPED AND WAXED EACH MONTH.'

IN A REPORT DATED MAY 16, 1969, GSA HAS CONCURRED IN YOUR OBSERVATION BY NOTING THAT THE ABOVE QUALIFICATION CONSTITUTES A MATERIAL DEVIATION FROM THE FREQUENCY OF MAINTENANCE SERVICE SPECIFIED IN THE IFB. HOWEVER, FOLLOWING A REVIEW BY A BOARD OF AWARD, IT WAS DETERMINED THAT THE OTHER BIDS RECEIVED UNDER THE INVITATION WERE EXCESSIVE, BASED UPON THE GOVERNMENT'S ESTIMATE OF $37,005.44, AND THE PROCURING AGENCY HAS THEREFORE CANCELLED THE IFB IN ACCORDANCE WITH FEDERAL PROCUREMENT REGULATIONS (FPR) 1-2.404-1 (B) (5), QUOTED "/B) 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:

(5) ALL OTHERWISE ACCEPTABLE BIDS RECEIVED ARE AT UNREASONABLE PRICES.' YOU MAINTAIN THAT SUCH ACTION WAS ERRONEOUSLY TAKEN AND CONTEND THAT YOUR BID OF $72,733.00 WAS NOT EXCESSIVE FOR SEVERAL REASONS STATED IN A LETTER DATED MAY 27, 1969.

OUR OFFICE HAS HELD THAT AS THE ADVERTISING STATUTES WERE ENACTED FOR THE PROTECTION OF THE GOVERNMENT, THE ISSUANCE OF AN INVITATION FOR BIDS DOES NOT CARRY WITH IT ANY LEGAL OBLIGATION TO ACCEPT ANY OF THE BIDS RECEIVED, INCLUDING THE LOWEST RESPONSIBLE AND RESPONSIVE BID. B 126211, JANUARY 9, 1956. CONSISTENT WITH THE FOREGOING WE HAVE HELD THAT:

"* * * WHEN IN THE LIGHT OF ALL THE FACTS, INCLUDING THOSE DISCLOSED BY THE BIDDING, IT IS ADMINISTRATIVELY DETERMINED THAT THE LOWEST ACCEPTABLE BID IS IN EXCESS OF THE AMOUNT FOR WHICH THE GOVERNMENT SHOULD BE ABLE TO OBTAIN THE SUPPLIES OR SERVICES SOUGHT, WE BELIEVE THAT THE REJECTION OF ALL BIDS AND READVERTISING OF THE CONTRACT IS A PROPER EXERCISE OF THE ADMINISTRATIVE DISCRETION, IN CONFORMITY WITH THE DUTY OF THE ADMINISTRATIVE OFFICIALS TO ACT IN THE BEST INTEREST OF THE GOVERNMENT. * *" (36 COMP. GEN. 364, 365)

WHILE THE GOVERNMENT'S ESTIMATE OF $37,005.44 IS BASED UPON COST EXPERIENCE IN CITIES OTHER THAN PITTSBURGH, AND YOU CONTEND THAT SUCH COST EXPERIENCE IS NOT APPLICABLE TO THE PRESENT PROCUREMENT BECAUSE OF A SHORTAGE OF SKILLED LABOR IN PITTSBURGH TO PERFORM STRIPPING AND WAXING WORK, THE CONTRACTING AGENCY APPEARS TO HOLD TO ITS BELIEF THAT ITS ESTIMATE IS MORE REPRESENTATIVE OF A REASONABLE PRICE THAN ARE THE PRICES RECEIVED FROM THE THREE HIGH BIDDERS. IN VIEW OF THE FACT THAT THE LOW BID OF $37,500 WAS ESSENTIALLY IN LINE WITH THE GOVERNMENT'S ESTIMATE, AND THAT BID DOES NOT APPEAR TO HAVE BEEN BASED UPON SUCH A MATERIAL DEVIATION FROM THE SPECIFICATIONS AS TO ACCOUNT FOR, OR JUSTIFY, THE $35,000 DIFFERENTIAL BETWEEN THE LOW BID AND YOUR BID, WE CANNOT SAY THAT THE DETERMINATION TO REJECT THE THREE HIGH BIDS AS UNREASONABLE IN PRICE IS ARBITRARY OR UNSUPPORTED BY THE RECORD.

WE MUST THEREFORE CONCLUDE THAT SUCH REJECTION WAS A PROPER EXERCISE OF ADMINISTRATIVE DISCRETION, AND YOUR PROTEST MUST BE DENIED.