B-167399, SEP. 22, 1969

B-167399: Sep 22, 1969

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REJECTION OF SECOND LOW BID FOR FAILURE TO ACKNOWLEDGE AMENDMENT WHICH WAS LOST IN TELEGRAPHIC TRANSMISSION AND WHICH COULD ONLY HAVE RESULTED IN A REDUCTION IN PRICE WAS NOT PROPER. HOWEVER SINCE AWARD WAS MADE TO THIRD LOW BIDDER IN JUNE AND WORK WAS TO BE COMPLETED WITHIN 120 DAYS. SECRETARY: REFERENCE IS MADE TO LETTER AFSPPOA OF AUGUST 7. BIDS WERE RECEIVED FROM 10 BIDDERS AND WERE OPENED ON MAY 29. THE THREE LOWEST BIDDERS WERE: JACK RIDINGS CONSTRUCTION CO. $26. 794 IT IS REPORTED THAT THE LOW BIDDER ALLEGED AN ERROR IN BID AND THAT AN ADMINISTRATIVE DETERMINATION WAS MADE PERMITTING WITHDRAWAL OF THE BID. WAS NOT ACCOMPANIED BY AN ACKNOWLEDGMENT OF AMENDMENTS 2 AND 3 TO THE INVITATION AND NONE WAS RECEIVED UP TO THE TIME AWARD WAS MADE TO THE THIRD LOW BIDDER ON JUNE 23.

B-167399, SEP. 22, 1969

BID PROTEST - ADDENDUM ACKNOWLEDGMENT DECISION TO SECRETARY OF AIR FORCE SUSTAINING PROTEST OF SECOND LOW BIDDER, ROBERT MCMULLAN AND SON, INC., AGAINST REJECTION OF BID FOR RENOVATION OF BUILDING AT RICHARDSGEBAUR AIR FORCE BASE. REJECTION OF SECOND LOW BID FOR FAILURE TO ACKNOWLEDGE AMENDMENT WHICH WAS LOST IN TELEGRAPHIC TRANSMISSION AND WHICH COULD ONLY HAVE RESULTED IN A REDUCTION IN PRICE WAS NOT PROPER. HOWEVER SINCE AWARD WAS MADE TO THIRD LOW BIDDER IN JUNE AND WORK WAS TO BE COMPLETED WITHIN 120 DAYS, CANCELLATION WOULD NOT BE PRACTICABLE OR IN GOVERNMENT'S INTEREST.

TO MR. SECRETARY:

REFERENCE IS MADE TO LETTER AFSPPOA OF AUGUST 7, 1969, FROM THE DEPUTY CHIEF, PROCUREMENT OPERATIONS DIVISION, DIRECTORATE, PROCUREMENT POLICY, DEPUTY CHIEF OF STAFF, SYSTEMS AND LOGISTICS, AND TO INFORMATION FURNISHED INFORMALLY ON AUGUST 12, 1969, REGARDING THE PROTEST OF ROBERT MCMULLAN AND SON, INC., UNDER INVITATION FOR BIDS F23608-69-B-0812, ISSUED BY RICHARDS-GEBAUR AIR FORCE BASE, MISSOURI, FOR THE RENOVATION OF BUILDING 100 IN CERTAIN RESPECTS.

BIDS WERE RECEIVED FROM 10 BIDDERS AND WERE OPENED ON MAY 29, 1969. THE THREE LOWEST BIDDERS WERE:

JACK RIDINGS CONSTRUCTION CO. $26,905

ROBERT MCMULLAN AND SON, INC 38,490 G.S. ROGERS CONSTRUCTION CO., INC. 41,794

IT IS REPORTED THAT THE LOW BIDDER ALLEGED AN ERROR IN BID AND THAT AN ADMINISTRATIVE DETERMINATION WAS MADE PERMITTING WITHDRAWAL OF THE BID.

THE NEXT LOW BID, SUBMITTED BY ROBERT MCMULLAN AND SON, INC., WAS NOT ACCOMPANIED BY AN ACKNOWLEDGMENT OF AMENDMENTS 2 AND 3 TO THE INVITATION AND NONE WAS RECEIVED UP TO THE TIME AWARD WAS MADE TO THE THIRD LOW BIDDER ON JUNE 23, 1969. ON JUNE 26, 1969, MCMULLAN ADVISED THE CONTRACTING OFFICER THAT A TELEGRAM ACKNOWLEDGING RECEIPT OF THE AMENDMENTS HAD BEEN SENT ON MAY 28, 1969. WESTERN UNION HAS EXPLAINED IN LETTER OF JULY 1, 1969, TO THE BIDDER, THAT THE MESSAGE APPARENTLY WAS LOST IN SWITCHING BETWEEN SAN DIEGO AND KANSAS CITY AND WAS NOT DELIVERED UNTIL JUNE 30, 1969.

AMENDMENT 2 PROVIDED THAT ON SHEET 2 OF THE GOVERNMENT'S DRAWINGS THE HEIGHT OF THE EXISTING AND PROPOSED WAINSCOT SHOULD BE CHANGED FROM 4 FEET 6 INCHES TO 4 FEET. AMENDMENT 3 MERELY PROVIDED FOR EXTENSION OF THE BID OPENING TIME TO 3 P.M., MAY 29, 1969.

THE CONTRACTING OFFICER REJECTED THE MCMULLAN BID ON THE GROUNDS THAT AMENDMENT 2 WAS A MATERIAL CHANGE IN THE PROJECT REQUIREMENTS AND THAT THE BID WAS NONRESPONSIVE FOR FAILING TO ACKNOWLEDGE THE AMENDMENT. FURTHER, THE CONTRACTING OFFICER HAS INDICATED THAT SINCE THE TELEGRAM ACKNOWLEDGING A MATERIAL REQUIREMENT WAS RECEIVED AFTER AWARD OF THE CONTRACT, IT WAS NOT FOR CONSIDERATION UNDER THE LATE BID PROVISIONS OF PARAGRAPH 7 OF THE INSTRUCTIONS TO BIDDERS AND PART 3 OF SECTION II OF THE ARMED SERVICES PROCUREMENT REGULATION, BOTH OF WHICH INCLUDE A REQUIREMENT THAT A LATE BID OR MODIFICATION THEREOF BE RECEIVED BEFORE AWARD.

WE AGREE THAT THERE ARE SITUATIONS WHEN THE FAILURE TO ACKNOWLEDGE AN AMENDMENT HAVING A MATERIAL EFFECT UPON THE INVITATION FOR BIDS CAN BE FATAL. SEE, FOR EXAMPLE, 47 COMP. GEN. 597. HOWEVER, WE DO NOT FEEL THAT THE BID IN THE IMMEDIATE CASE SHOULD HAVE BEEN REJECTED FOR FAILURE TO ACKNOWLEDGE THE AMENDMENTS TIMELY.

THE INVITATION FOR BIDS PROVIDED THAT THE WORK WILL INCLUDE "OVERLAYING OF EXISTING HARDBOARD WAINSCOTS WITH PREFINISHED HARDBOARD PANELING IN HALLS AND LATRINES.' PARAGRAPH 1A-01 OF THE GENERAL REQUIREMENTS OF THE SPECIFICATIONS STATED THAT THE WORK TO BE PERFORMED CONSISTS OF "REPAIR BY REPLACING WAINSCOTING ALONG HALLWAYS AND IN LATRINES.' PARAGRAPH 6D-04 OF THE WAINSCOT SECTION OF THE SPECIFICATION PROVIDES,"SURFACE PREPARATION: * * * THE EXISTING WAINSCOT SHALL BE LEFT IN PLACE.' INCLUDED IN PAGE 2 OF THE DRAWINGS INCLUDED IN THE INVITATION WERE DIAGRAMS OF THE EXISTING AND PROPOSED TYPICAL HALLWAY WALL SECTION. THE DIAGRAM OF THE EXISTING HALLWAY WALL SECTION SHOWS THE POSITION OF THE OLD WAINSCOT AND THAT IT IS 4 FEET 6 INCHES HIGH. THE DIAGRAM OF THE PROPOSED HALLWAY WALL SECTION SHOWS THE OLD WAINSCOT WITH THE NEW WAINSCOT OVERLAID AND IT SHOWS THE HEIGHT OF BOTH AS 4 FEET 6 INCHES.

ALTHOUGH THE DRAWINGS, AS ORIGINALLY ISSUED, SHOW THE EXISTING WAINSCOT AS 4 FEET 6 INCHES AND THE OVERLAYING WAINSCOT AS THE SAME HEIGHT, UNDER THE CONTRACT, THE CONTRACTOR WOULD BE REQUIRED TO COVER THE EXISTING WAINSCOT. THUS, IF THE EXISTING WAINSCOT WAS NO MORE THAN 4 FEET HIGH, THE COVERING WAINSCOT WOULD BE NO HIGHER AS INDICATED BY THE SPECIFICATIONS AND THE DIAGRAMS IN THE DRAWINGS. ACCORDINGLY, AMENDMENT 2 WHICH CHANGED THE DRAWINGS TO SHOW THE CORRECT HEIGHT IN THE EXISTING AND PROPOSED WAINSCOT AS 4 FEET WAS NO MORE THAN THE CORRECTION OF A CLERICAL ERROR, SINCE THE CONTRACTOR WOULD BE REQUIRED TO DO NO MORE THAN INSTALL A WAINSCOT OF THAT HEIGHT WITHOUT THE AMENDMENT. IN THE CIRCUMSTANCES, THE AMENDMENT DID NOT CHANGE THE WORK INVOLVED.

THE CHANGE IN WAINSCOT HEIGHT WOULD BE IMPORTANT ONLY TO THE EXTENT THAT ANY BIDDER MAY HAVE ESTIMATED THE QUANTITY OF WAINSCOTING MATERIAL FROM THE DIMENSIONS PROVIDED IN THE DRAWING DIAGRAMS. ACCORDING TO INFORMATION FURNISHED OUR OFFICE ON AUGUST 12, 1969, THE REDUCTION IN THE WAINSCOT HEIGHT INVOLVED A DIFFERENCE OF ABOUT 875 SQUARE FEET. BUT, AS SHOWN ABOVE, IT DOES NOT APPEAR THAT THIS REDUCTION IN WAINSCOTING WOULD HAVE ANY EFFECT ON THE AMOUNT OF WORK REQUIRED TO BE PERFORMED. AS TO EFFECT ON PRICE, THE ONLY BIDS THAT ARE CONTAINED IN THE FILE SUBMITTED WITH THE REPORT ON THE PROTEST ARE THE COPIES OF THE SECOND AND THIRD LOW BIDS. FROM AN EXAMINATION OF THESE BIDS, IT APPEARS THAT THE LATE-RECEIVED ACKNOWLEDGMENT OF AMENDMENTS 2 AND 3 FROM THE SECOND LOW BIDDER STATED THAT ITS BID REMAINED UNCHANGED, AND THAT THE THIRD LOW BIDDER DID NOT CHANGE ITS PRICE WHEN IT ACKNOWLEDGED THE AMENDMENTS. IT IS REASONABLE TO ASSUME THAT THESE BIDDERS WERE AWARE OF THE ACTUAL REQUIREMENTS WHEN THEY PREPARED THEIR ORIGINAL BIDS BECAUSE OF AN EXAMINATION OF THE PREMISES OR THAT THEY CONSIDERED THE CHANGE TO BE TOO TRIVIAL TO REQUIRE A BID PRICE REVISION. IN ANY EVENT, THE REDUCTION IN WAINSCOTING COULD RESULT ONLY IN A REDUCTION IN PRICE. IN B-165150, SEPTEMBER 16, 1968, WE HELD THAT A BID SHOULD NOT BE REJECTED FOR FAILURE TO ACKNOWLEDGE RECEIPT OF AMENDMENTS WHICH CONTAIN ITEMS FOR WHICH THERE WOULD BE REDUCTIONS IN PRICE ONLY, AND STATED:

"* * * AS WAS STATED IN 41 COMP. GEN. 550, 553, IF IT IS ASSUMED THAT THE LOW BIDDER'S FAILURE TO ACKNOWLEDGE THE ADDENDUM WAS DUE TO IGNORANCE OF ITS EXISTENCE, THEN HIS BID PRICE WOULD NOT REFLECT THE LESSENED REQUIREMENTS OF THE SPECIFICATIONS AND, THEREFORE, HIS FAILURE TO ACKNOWLEDGE WOULD ONLY BE PREJUDICIAL TO HIS COMPETITIVE POSITION AND EVEN POSSIBLY BENEFICIAL TO THE POSITION OF OTHER BIDDERS.- FURTHER, IN B- 159412, JULY 26, 1966, WE HELD THAT -WHERE THE UNACKNOWLEDGED AMENDMENT MERELY EFFECTS A DECREASE IN THE COST OF PERFORMANCE FAILURE TO ACKNOWLEDGE IT SHOULD BE WAIVED AS A MINOR INFORMALITY.- * * *"

IN VIEW OF THE FOREGOING, IT DOES NOT APPEAR THAT THE REJECTION OF THE SECOND LOW BID WAS PROPER. HOWEVER, CONSIDERING THAT THE AWARD TO THE THIRD LOW BIDDER WAS MADE JUNE 23, 1969, AND THAT WORK WAS TO BE COMPLETED WITHIN 120 DAYS FROM DATE OF RECEIPT OF THE NOTICE TO PROCEED, CANCELLATION OF THE CONTRACT AT THIS LATE DATE WOULD NOT BE PRACTICABLE OR IN THE GOVERNMENT'S INTERESTS. WE RECOMMEND THAT APPROPRIATE ACTION BE TAKEN TO PRECLUDE THE RECURRENCE OF SIMILAR BID REJECTIONS IN THE FUTURE.