B-167474, AUG. 4, 1969

B-167474: Aug 4, 1969

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

WHERE SOLE BID WAS 28 PERCENT LESS THAN GOVERNMENT ESTIMATE AND PRICE FOR ITEM ONLY ONE-EIGHTH OF ESTIMATED COST. CONTRACTING OFFICER SHOULD HAVE BEEN ALERTED TO POSSIBILITY OF ERROR. HAVE REQUESTED VERIFICATION BEFORE AWARD. SECRETARY: REFERENCE IS MADE TO A LETTER OF JULY 8. DIN-S296 WERE ISSUED BY THE NATIONAL PARK SERVICE ON MAY 9. SIXTY PROSPECTIVE BIDDERS WERE SOLICITED AND ONE BID WAS RECEIVED. WAS IN THE TOTAL AMOUNT OF $211. THE BID WAS RECEIVED IN THE SAN FRANCISCO OFFICE ON THURSDAY. NOTICE OF AWARD WAS SENT TO THE CONTRACTOR ON MONDAY. THE DEPUTY ASSISTANT SECRETARY ADVISES THAT UPON REVIEW OF THE CIRCUMSTANCES AND THE DATA FURNISHED HE IS CONVINCED THAT A BONA FIDE MISTAKE WAS MADE AND THAT IT WAS OF SUCH MAGNITUDE THAT IT SHOULD HAVE PUT THE CONTRACTING OFFICER ON NOTICE OF THE POSSIBILITY OF AN ERROR IN THE BID.

B-167474, AUG. 4, 1969

CONTRACTS - MISTAKES DECISION TO SECRETARY OF THE INTERIOR AUTHORIZING REFORMATION OF CONTRACT AWARDED TO WILLIAMS, INC., SOLE BIDDER FOR SLOPE STABLIZATION WORK AT DINOSAUR NATIONAL MONUMENT ON BASIS OF MISTAKE IN BID. WHERE SOLE BID WAS 28 PERCENT LESS THAN GOVERNMENT ESTIMATE AND PRICE FOR ITEM ONLY ONE-EIGHTH OF ESTIMATED COST, CONTRACTING OFFICER SHOULD HAVE BEEN ALERTED TO POSSIBILITY OF ERROR. CONTRACTING OFFICER SHOULD, THEREFORE, HAVE REQUESTED VERIFICATION BEFORE AWARD. CORRECTION TO REFLECT INTENDED PRICE AUTHORIZED.

TO MR. SECRETARY:

REFERENCE IS MADE TO A LETTER OF JULY 8, 1969, WITH ENCLOSURES, FROM THE DEPUTY ASSISTANT SECRETARY FOR ADMINISTRATION, SUBMITTING FOR OUR CONSIDERATION A REQUEST FOR REFORMATION OF CONTRACT NO. 14-10-7-971 209, BASED ON A MISTAKE IN BID ALLEGED AFTER AWARD OF CONTRACT TO WILLIAMS, INC.

INVITATIONS TO BID ON PROJECT NO. DIN-S296 WERE ISSUED BY THE NATIONAL PARK SERVICE ON MAY 9, 1969, FOR SLOPE STABILIZATION OF THE HARPERS CORNER ROAD AT DINOSAUR NATIONAL MONUMENT, COLORADO AND UTAH. SIXTY PROSPECTIVE BIDDERS WERE SOLICITED AND ONE BID WAS RECEIVED.

THE SOLE BID FROM WILLIAMS, INC., WAS IN THE TOTAL AMOUNT OF $211,875, OR $80,944 LESS THAN THE GOVERNMENT'S ESTIMATE OF $292,819. THE BID WAS RECEIVED IN THE SAN FRANCISCO OFFICE ON THURSDAY, JUNE 12, AND NOTICE OF AWARD WAS SENT TO THE CONTRACTOR ON MONDAY, JUNE 16. ON JUNE 18, THE CONTRACTOR INFORMED THE BID OPENING OFFICER IN OMAHA BY TELEPHONE AND THEN BY FOLLOWUP LETTER THAT THE PRICE OF $50 PER ACRE HAD BEEN ERRONEOUSLY ENTERED FOR ITEM NO. 2 OF THE SCHEDULE INSTEAD OF THE INTENDED PRICE OF $500 PER ACRE.

THE DEPUTY ASSISTANT SECRETARY ADVISES THAT UPON REVIEW OF THE CIRCUMSTANCES AND THE DATA FURNISHED HE IS CONVINCED THAT A BONA FIDE MISTAKE WAS MADE AND THAT IT WAS OF SUCH MAGNITUDE THAT IT SHOULD HAVE PUT THE CONTRACTING OFFICER ON NOTICE OF THE POSSIBILITY OF AN ERROR IN THE BID. HENCE, IT IS RECOMMENDED THAT THE CONTRACT BE REFORMED TO REFLECT THE INTENDED BID PRICE FOR ITEM NO. 2.

ORDINARILY, WHERE, AS HERE, ONLY ONE BID IS RECEIVED, THERE IS NO BASIS FOR COMPARISON OF BIDS. 17 COMP. GEN. 560; 26 ID. 415. HOWEVER, THAT RULE IS NOT APPLICABLE HERE WHERE THE BID PRICE WAS SUBSTANTIALLY LESS (ABOUT 28 PERCENT) THAN THE GOVERNMENT ESTIMATE, AND THE BID PRICE FOR ITEM NO. 2 WAS ONLY ONE-EIGHTH OF THE ESTIMATED COST OF THE ITEM. SEE B- 155177, NOVEMBER 18, 1964, WHERE THE GOVERNMENT ESTIMATE WAS APPROXIMATELY DOUBLE THE AMOUNT OF THE ONLY BID RECEIVED. WE HELD THAT THIS SHOULD HAVE ALERTED THE CONTRACTING OFFICER TO THE POSSIBILITY OF ERROR. WE BELIEVE THAT SUCH HOLDING APPLIES EQUALLY HERE. IN THESE CIRCUMSTANCES, IT MAY BE CONCLUDED THAT THE CONTRACTING OFFICER, HAVING THE GOVERNMENT ESTIMATE BEFORE HIM, SHOULD HAVE VERIFIED THE BID PRICE BEFORE AWARD.

ACCORDINGLY, AND SINCE THE ERROR IS REASONABLY ESTABLISHED BY THE FACTS OF RECORD, THE CONTRACT MAY BE AMENDED TO REFLECT THE INTENDED PRICE OF $500 PER ACRE FOR ITEM NO. 2.

AS REQUESTED, THE ENCLOSURES TO THE JULY 8 LETTER ARE RETURNED.

REFERENCE TO THIS DECISION SHOULD BE MADE IN THE AMENDMENT TO THE CONTRACT.