B-168108, JAN. 13, 1970

B-168108: Jan 13, 1970

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EVALUATION OF PROTESTANT'S BID ON BASIS OF ADDITION OF 6 PERCENT DIFFERENTIAL PURSUANT TO BUY AMERICAN ACT THEREBY MAKING BID HIGHER THAN OTHER BID WAS PROPER. REJECTION OF LOW BID FOR FAILURE TO COMPLY WITH WORKMANSHIP REQUIREMENTS WHEN DESIGNATED SPECIFICATION DID NOT CONTAIN ANY SUCH REQUIREMENTS AND AWARD TO ANOTHER BIDDER WERE ERRONEOUS. AGENCY'S DETERMINATION TO CANCEL ERRONEOUS AWARD BECAUSE WORKMANSHIP REQUIREMENTS ARE ESSENTIAL AND READVERTISE UNDER REVISED SPECIFICATION IS NOT IMPROPER. INC.: REFERENCE IS MADE TO YOUR PROTEST BY TELEGRAM AND LETTER DATED OCTOBER 13. YOU CLAIM THAT YOU WERE THE LOW BIDDER ON THE ITEMS IN QUESTION. WHICH WERE EITHER CANCELLED OR AWARDED TO OTHER BIDDERS.

B-168108, JAN. 13, 1970

BID PROTEST--EVALUATION--SAMPLE DECISION TO LUTZ SUPERDYNE, INC; DENYING PROTEST AGAINST REJECTION OF LOW BID FOR NINE ITEMS UNDER INVITATION BY FEDERAL SUPPLY SERVICE, GENERAL SERVICES ADMINISTRATION, FOR MEASURING TAPES AND REPAIR KITS. EVALUATION OF PROTESTANT'S BID ON BASIS OF ADDITION OF 6 PERCENT DIFFERENTIAL PURSUANT TO BUY AMERICAN ACT THEREBY MAKING BID HIGHER THAN OTHER BID WAS PROPER. REJECTION OF LOW BID FOR FAILURE TO COMPLY WITH WORKMANSHIP REQUIREMENTS WHEN DESIGNATED SPECIFICATION DID NOT CONTAIN ANY SUCH REQUIREMENTS AND AWARD TO ANOTHER BIDDER WERE ERRONEOUS. AGENCY'S DETERMINATION TO CANCEL ERRONEOUS AWARD BECAUSE WORKMANSHIP REQUIREMENTS ARE ESSENTIAL AND READVERTISE UNDER REVISED SPECIFICATION IS NOT IMPROPER. CANCELLATION OF INVITATION AFTER BID OPENING BECAUSE PRINCIPAL USER DID NOT NEED ITEM APPEARS JUSTIFIABLE UNDER FEDERAL PROCUREMENT REGULATIONS 1- 2.404-1 (B) (2). LAPSE OF ONE WEEK BETWEEN DATE OF AWARD AND DATE OF VERBAL NOTICE OF REJECTION, WHICH TIME DID NOT PLACE PROTESTANT IN DETRIMENTAL POSITION DOES NOT PRESENT BASIS FOR OBJECTION.

TO LUTZ SUPERDYNE, INC.:

REFERENCE IS MADE TO YOUR PROTEST BY TELEGRAM AND LETTER DATED OCTOBER 13, 1969, AS SUPPLEMENTED BY SUBSEQUENT CORRESPONDENCE, CONCERNING NINE ITEMS LISTED IN INVITATION FOR BIDS (IFB) FPNTP-B10 70567-A-7-1-69, ISSUED MAY 28, 1969, BY THE FEDERAL SUPPLY SERVICE, GENERAL SERVICES ADMINISTRATION (GSA). YOU CLAIM THAT YOU WERE THE LOW BIDDER ON THE ITEMS IN QUESTION, WHICH WERE EITHER CANCELLED OR AWARDED TO OTHER BIDDERS, AND THAT NOTICE OF REJECTION OF YOUR BID WAS NOT ISSUED IN SUFFICIENT TIME TO PERMIT YOU TO FILE A TIMELY PROTEST.

THE INVITATION REQUESTED BIDS FOR A REQUIREMENTS CONTRACT COVERING 35 ITEMS OF FS CLASS 5210, MEASURING TAPES, CLAMPS AND REPAIR KITS, FOR THE PERIOD SEPTEMBER 1, 1969, THROUGH AUGUST 31, 1970. BIDS WERE OPENED ON JULY 11, 1969, AND YOU WERE LOW AS TO ITEMS 3, 10, 13, 14, 18, 28, 30, 31, AND 32, WHICH YOU INDICATED IN THE BUY AMERICAN CERTIFICATE ON PAGE 2 OF YOUR BID, STANDARD FORM 33, WERE OF FOREIGN ORIGIN. YOUR CHARGES CONCERNING EACH ITEM AND THE GSA COMMENTS THEREON WILL BE DISCUSSED ON A ITEM-BY-ITEM BASIS BELOW. IN THIS CONNECTION, YOU ARE ADVISED THAT IN THE ABSENCE OF ANY EVIDENCE SUFFICIENT TO OVERCOME THE PRESUMPTION OF THE CORRECTNESS OF THE GSA REPORT, WE MUST ACCEPT THE REPORT AS CORRECT.

ON ITEM 3, YOU QUOTED A LOW UNIT PRICE OF $5.75, AND LUFKIN DIVISION COOPER INDUSTRIES, INC. (LUFKIN) QUOTED THE NEXT LOW UNIT PRICE OF $6.05. UPON ADDITION TO YOUR BID OF A 6-PERCENT DIFFERENTIAL, AS REQUIRED BY EXECUTIVE ORDER 10582, DATED DECEMBER 17, 1954, ISSUED IN IMPLEMENTATION OF THE BUY AMERICAN ACT, 41 U.S.C. 10A-D, AND BY FEDERAL PROCUREMENT REGULATION 1-6.104-4(B), YOUR EVALUATED PRICE WAS $6.095 PER UNIT. ACCORDINGLY, AWARD OF THE ITEM WAS MADE TO LUFKIN AS THE LOWEST BIDDER. YOU STATE, "EVIDENTLY THEIR BID MUST HAVE COME IN AFTER THE OPENING." GSA REPORTS THAT LUFKIN'S BID WAS TIMELY RECEIVED AND WAS OPENED WITH THE OTHER BIDS. ACCORDINGLY, WE SEE NO LEGAL BASIS TO QUESTION THE AWARD OF THE ITEM TO LUFKIN.

ON ITEM 10, YOU QUOTED THE LOW PRICE OF $2.55 PER UNIT. YOUR BID WAS REJECTED ON THE BASIS THAT THE SAMPLE REQUIRED BY THE IFB WAS DEFICIENT, AND AWARD WAS MADE TO JUST US ROE & SON, INC. (ROE), THE NEXT LOW BIDDER, AT A UNIT PRICE OF $3.19. GSA POINTS OUT THAT THE SAMPLE REQUIREMENTS PROVISIONS IN THE IFB STATED THAT THE SAMPLES WOULD BE EVALUATED FOR WORKMANSHIP CHARACTERISTICS IN ACCORDANCE WITH THE APPLICABLE SPECIFICATION AND SINCE FEDERAL SPECIFICATION GGG-T 00106C, APPLICABLE TO ITEM 10, CONTAINS NO REQUIREMENTS WITH RESPECT TO WORKMANSHIP, THE REJECTION OF THE SAMPLES FURNISHED BY YOU FOR ITEM 10 FOR FAILURE TO COMPLY WITH WORKMANSHIP REQUIREMENTS WAS ERRONEOUS. YOUR CONTENTION ON THIS POINT APPEARS TO BE CORRECT. HOWEVER, GSA ADVISED THAT A WORKMANSHIP REQUIREMENT IS CONSIDERED TO BE ESSENTIAL TO MEET THE GOVERNMENT'S MINIMUM REQUIREMENTS. ACCORDINGLY, GSA IS CANCELLING THE ERRONEOUS AWARD FOR THE ITEM AND WILL READVERTISE THE PROCUREMENT UNDER A REVISED SPECIFICATION, WHICH WILL INCLUDE A REQUIREMENT WITH RESPECT TO WORKMANSHIP.

GSA, AS THE CONTRACTING AGENCY, BEARS THE PRIMARY RESPONSIBILITY FOR DRAFTING SPECIFICATIONS WHICH REFLECT THE MINIMUM NEEDS OF THE GOVERNMENT. ACCORDINGLY, IN THE ABSENCE OF ANY INDICATION THAT THE DECISION TO INCLUDE WORKMANSHIP REQUIREMENTS FOR ITEM 10 IN THE APPLICABLE FEDERAL SPECIFICATION IS OTHER THAN A VALID EXERCISE OF THE AUTHORITY NECESSARY TO DISCHARGE SUCH RESPONSIBILITY, WE ARE UNABLE TO CONCLUDE THAT THE ACTIONS TAKEN BY GSA WITH RESPECT TO ITEM 10 ARE IMPROPER.

ITEMS 13, 14, AND 18, METALLIC WOVEN TAPES, WERE CANCELLED AFTER BID OPENING, AND YOU WERE NOTIFIED THAT SUCH ACTION WAS PROMPTED BY A CHANGE IN THE GOVERNMENT'S REQUIREMENTS. IN THIS CONNECTION, GSA REPORTS THAT ITS SUPPLY OF SUCH ITEMS (PRESUMABLY AT THE TIME THE IFB WAS ISSUED) WAS DETERMINED TO BE SUFFICIENT TO MEET NORMAL NEEDS FOR A YEAR; HOWEVER, JUST PRIOR TO BID OPENING, THE DEPARTMENT OF THE ARMY, ONE OF THE PRINCIPAL USERS OF THE ITEMS, INFORMED GSA THAT THE ARMY WOULD NOT HAVE FURTHER NEED FOR METALLIC WOVEN TAPES, WHEREUPON ALL OF THE METALLIC TAPE ITEMS IN THE IFB (ITEMS 13 THROUGH 20) WERE CANCELLED. IN THE CIRCUMSTANCES, WE BELIEVE THAT THERE WAS ADEQUATE JUSTIFICATION FOR GSA'S ACTION. SEE FPR 1 -2.404-1 (B) (2), WHICH AUTHORIZES CANCELLATION WHEN IT IS DETERMINED, AFTER BID OPENING, THAT THE SUPPLIES ARE NO LONGER REQUIRED.

AS TO ITEM 28, WHICH WAS ALSO CANCELLED ON THE BASIS OF A CHANGE IN THE GOVERNMENT'S REQUIREMENTS, GSA STATES THAT AFTER BID OPENING THE CONTRACTING OFFICER ASCERTAINED, IN LIGHT OF RECENT AND CURRENT REQUISITIONS, THAT THE SUPPLY OF THE ITEM ON HAND, WHICH IS SAID TO BE A LOW VOLUME ITEM, WAS SUFFICIENT TO MEET REQUIREMENTS FOR APPROXIMATELY 45 MONTHS. SUCH FACTOR, WE BELIEVE, WAS ALSO SUFFICIENT TO JUSTIFY CANCELLATION OF THE ITEM PURSUANT TO FPR 1-2.404-1 (B) (2).

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

THE PROVISIONS RELATING TO BID SAMPLES WERE SET FORTH IN PARAGRAPHS 13 AND 14 OF THE IFB. UNDER PARAGRAPH 13, BIDDERS WERE ADVISED THAT THE FAILURE OF SAMPLES TO CONFORM TO ALL OF THE CHARACTERISTICS LISTED FOR EXAMINATION IN THE IFB WOULD REQUIRE REJECTION OF BIDS. PARAGRAPH 14 REQUIRED TWO REPRESENTATIVE SAMPLES EACH FOR ITEMS 30, 31 AND 32, AND CITED MILITARY SPECIFICATION MIL-T-16644B AS THE CONTROLLING SPECIFICATION FOR DETERMINATION OF COMPLIANCE WITH ALL CHARACTERISTICS.

YOUR REPRESENTATIVE SAMPLES OF ITEMS 30 THROUGH 32, GSA REPORTS, WERE EXAMINED BY A GSA QUALITY CONTROL REPRESENTATIVE, WHO DETERMINED THAT THE SAMPLES DID NOT MEET THE WORKMANSHIP REQUIREMENTS. THE SAMPLES WERE THEREFORE REJECTED. GSA CONCURS WITH YOUR VIEW THAT THE SAMPLES MIGHT HAVE BEEN DAMAGED IN TRANSIT BUT POINTS OUT THAT SOME OF THE DEFECTS, SUCH AS THE POORLY AFFIXED AND DISTORTED GRADUATION MARKINGS ON THE ITEM 31 SAMPLES, COULD HARDLY HAVE RESULTED FROM MISHANDLING EITHER ENROUTE OR WHILE THE SAMPLES WERE IN THE CUSTODY OF GSA PERSONNEL.

AS TO THE GOVERNMENT'S METHODS OF HANDLING AND EVALUATING SAMPLES, GSA STATES THAT BID SAMPLES ARE RECEIVED IN A BID SAMPLE ROOM, IN WHICH THEY ARE OPENED, IDENTIFIED AND STORED; THAT THE SAMPLES ARE AVAILABLE FOR INSPECTION DURING REGULAR BUSINESS HOURS BY ANY BIDDER; AND THAT WHILE THE QUALITY CONTROL INSPECTION IS NOT PUBLIC, ANY BIDDER MAY MAKE ARRANGEMENTS TO HAVE A REPRESENTATIVE PRESENT DURING THE QUALITY CONTROL EVALUATION OF ITS SAMPLES.

WITH SPECIFIC REFERENCE TO THE SAMPLES WHICH YOU SUBMITTED, GSA TAKES EXCEPTION TO YOUR CLAIM THAT SAMPLES FURNISHED BY YOU WERE APPROVED BY GSA ON A NUMBER OF TIEMS PREVIOUSLY. CONVERSELY, GSA STATES, THESE PARTICULAR SAMPLES WERE FIRST SUBMITTED TO GSA WITH YOUR BID FOR THE PREVIOUS CONTRACT PERIOD, BUT THE SAMPLES WERE NOT INSPECTED OR EVALUATED AT THAT TIME BECAUSE YOUR BID WAS NOT LOW ON THE ITEMS. FURTHER, GSA STATES, THE SAMPLES WERE AVAILABLE IN THE GSA BID SAMPLE LIBRARY FOR INSPECTION BY YOUR REPRESENTATIVES PRIOR TO BEING OFFERED BY YOU UNDER THE CURRENT IFB, AND REPLACEMENT COULD HAVE BEEN EFFECTED IF, UPON INSPECTION, YOU HAD DEEMED SUCH ACTION NECESSARY.

THERE IS NO INDICATION IN THE RECORD THAT THE REJECTION OF YOUR SAMPLES PURSUANT TO THE JUDGMENT OF INADEQUACY MADE BY THE QUALITY CONTROL INSPECTOR WAS NOT A PROPER ACTION IN KEEPING WITH THE RESPONSIBILITY OF THE CONTRACTING AGENCY TO DETERMINE WHETHER ITEMS OFFERED TO THE GOVERNMENT MEET THE REQUIREMENTS OF THE ADVERTISED SPECIFICATIONS. ACCORDINGLY, AND IN LIGHT OF THE INFORMATION FURNISHED BY GSA REGARDING THE HANDLING OF SAMPLES, WE ARE UNABLE TO CONCLUDE THAT THE ACTIONS TAKEN IN THIS PROCUREMENT WERE CONTRARY TO THE RULES OF COMPETITIVE BIDDING AND THE IMPLEMENTING PROVISIONS OF THE PROCUREMENT REGULATIONS. SEE FPR 1- 2.202-4.

WITH RESPECT TO THE TIMELINESS OF THE NOTICE TO YOU OF REJECTION OF YOUR BID, GSA HAS ADVISED THAT AWARD OF ITEMS 10, 30, 31 AND 32 WAS MADE ON OCTOBER 3 AND THAT YOU WERE VERBALLY NOTIFIED OF SUCH ACTION ON OCTOBER 10 IN ADDITION TO THE WRITTEN NOTIFICATION BY LETTER DATED OCTOBER 20, WHICH YOU HAVE ACKNOWLEDGED. AS TO THE REMAINING FIVE ITEMS COVERED BY YOUR PROTEST, NO REJECTIONS OF YOUR BID WERE INVOLVED SINCE FOUR OF THE ITEMS (13, 14, 18 AND 28) WERE CANCELLED, AND ON ITEM 3 LUFKIN WAS THE LOWEST BIDDER AFTER EVALUATION OF YOUR BID IN ACCORDANCE WITH THE BUY AMERICAN ACT, AS IMPLEMENTED BY EXECUTIVE ORDER 10582 AND FPR 1-6.104-4(B). IN ANY EVENT, THE LAPSE OF ONE WEEK BETWEEN THE DATE OF AWARD OF ITEMS 10 AND 30, 31 AND 32 AND THE DATE OF VERBAL NOTICE TO YOU HAS NOT WORKED TO YOUR DETRIMENT SINCE THE AWARD MADE ON ITEM 10 HAS BEEN CANCELLED AS A CONSEQUENCE OF YOUR PROTEST, AND OUR REVIEW DISCLOSES NO ILLEGALITY IN THE AWARDS OF ITEMS 30, 31 AND 32.