B-168684, MAR. 20, 1970

B-168684: Mar 20, 1970

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INASMUCH AS TRANSPORTATION OF BULK COMMODITIES BY WATER IS EXEMPT FROM PART III. NO PUBLISHED RATES WERE AVAILABLE. A REQUEST FOR CHARGES WAS NECESSARY IN THIS INSTANCE SINCE THE TRANSPORTATION OF BULK COMMODITIES BY WATER IS EXEMPT FROM PART III OF THE INTERSTATE COMMERCE ACT AND NO PUBLISHED RATES WERE AVAILABLE. THE RATE QUOTATIONS SUBMITTED BY ALLIED TOWING CORPORATION WAS DETERMINED TO BE THE MOST COST ADVANTAGEOUS TO THE GOVERNMENT. OF PRIMARY SIGNIFICANCE IS THE FACT THAT ALLIED TOWING QUOTED A UNIT PRICE OF ?0650 ON THE BASIS OF THE REQUIRED 10. IF FOR ANY REASON ANY ONE INCREMENT MOVED WAS 10. WHICH IS MORE THAN THE TOTAL POTENTIAL SAVING UNDER EASTERN'S BID. A BASIS NOT REQUESTED BY THE GOVERNMENT AND UPON WHICH COMPETITION WAS NOT OBTAINED.

B-168684, MAR. 20, 1970

BIDS--EVALUATION--DELIVERY PROVISIONS--BARRED INCREMENTS OF FUEL ST. LOUIS FIELD OFFICE, MTMTS, INVITED 11 LIQUID BARGE OPERATORS TO SUBMIT CHARGES FOR MOVEMENT OF 400,000 BARRELS JET FUEL IN INCREMENTS OF 10,000 BARRELS FROM ORIGINS TO NORFOLK, VA; INASMUCH AS TRANSPORTATION OF BULK COMMODITIES BY WATER IS EXEMPT FROM PART III, IC ACT, AND NO PUBLISHED RATES WERE AVAILABLE. PROTESTANT WHO QUOTED LOWER PRICE ON BASIS OF MINIMUM 12,000 BARRELS AND 1/2 CENT HIGHER BASED ON 10,000 BARRELS, OFFERS NO BASIS FOR OBJECTION SINCE SUCCESSFUL OFFEROR SUBMITTED LOW CHARGES FOR MOVEMENT OF FUEL IN INCREMENTS OF 10,000 BARRELS AS REQUESTED BY MTMTS AND GAO BELIEVES CONTRACT OR B/L SHOULD BE EXECUTED WITH OPERATOR SUBMITTING LOW CHARGES ON BASIS REQUESTED BY GOVT.

TO EASTERN CARRIERS, INCORPORATED:

THIS CONCERNS YOUR TELEGRAM OF DECEMBER 23, 1969, PROTESTING THE AWARD BY THE ST. LOUIS FIELD OFFICE, EASTERN OFFICE, MILITARY TRAFFIC MANAGEMENT AND TERMINAL SERVICE (MTMTS), OF A CONTRACT FOR MOVEMENT OF JET FUEL TO A HIGHER BIDDER.

THE DEPARTMENT OF THE ARMY BY A REPORT DATED FEBRUARY 26, 1970, ADVISED THIS OFFICE AS FOLLOWS:

"THE RECORD REVEALS THAT AT THE REQUEST OF THE NAVY, THE ST. LOUIS FIELD OFFICE, MTMTS, INVITED ELEVEN BULK LIQUID BARGE OPERATORS TO SUBMIT CHARGES FOR THE MOVEMENT OF APPROXIMATELY 400,000 BARRELS OF JET FUEL IN INCREMENTS OF APPROXIMATELY 10,000 BARRELS FROM SPECIFIC ORIGINS TO THE NAVAL AIR STATION, NORFOLK, VIRGINIA. A REQUEST FOR CHARGES WAS NECESSARY IN THIS INSTANCE SINCE THE TRANSPORTATION OF BULK COMMODITIES BY WATER IS EXEMPT FROM PART III OF THE INTERSTATE COMMERCE ACT AND NO PUBLISHED RATES WERE AVAILABLE.

"OF THE FIVE CARRIERS THAT RESPONDED, THE RATE QUOTATIONS SUBMITTED BY ALLIED TOWING CORPORATION WAS DETERMINED TO BE THE MOST COST ADVANTAGEOUS TO THE GOVERNMENT. OF PRIMARY SIGNIFICANCE IS THE FACT THAT ALLIED TOWING QUOTED A UNIT PRICE OF ?0650 ON THE BASIS OF THE REQUIRED 10,000 BARREL INCREMENTS WHEREAS EASTERN CARRIERS QUOTED A UNIT PRICE OF ?0649 BASED ON A MINIMUM 12,000 BARRELS AND ONE-HALF CENT HIGHER (OR ?0699) BASED ON 10,000 BARRELS."

THIS OFFICE HAS CONSISTENTLY TAKEN THE POSITION IN GOVERNMENT PROCUREMENTS THAT THE PROCURING ACTIVITY HAS THE RESPONSIBILITY FOR DRAFTING SPECIFICATIONS TO FULFILL THEIR REQUIREMENTS AND THAT ANY CONTRACT SHOULD BE AWARDED TO THE LOW OFFEROR WHO MEETS THOSE REQUIREMENTS. WHILE IN THIS INSTANCE THE SUBMISSION OF CHARGES DOES NOT RESULT IN A CONTRACT UNTIL THE ACCEPTANCE OF THE TENDER BY THE NAVY THROUGH THE ISSUANCE OF A GOVERNMENT BILL OF LADING, WE BELIEVE THAT A CONTRACT OR BILL OF LADING SHOULD BE EXECUTED WITH THE BARGE OPERATOR SUBMITTING THE LOW CHARGES ON THE BASIS REQUESTED BY THE GOVERNMENT. ALLIED TOWING CORPORATION SUBMITTED THE LOW CHARGES FOR MOVEMENT OF THE JET FUEL IN INCREMENTS OF 10,000 BARRELS AS REQUESTED BY MTMTS FOR SHIPMENTS FROM THE PRIMARY LOADING POINT, CRANEY ISLAND, TO THE NAVAL AIR STATION.

EVEN ASSUMING THAT EASTERN COULD MOVE THE ENTIRE ESTIMATED QUANTITY IN 12,000 BARREL INCREMENTS, THE TOTAL TRANSPORTATION SAVING TO THE GOVERNMENT WOULD AMOUNT TO ONLY $40, COMPARED TO THE RATES OFFERED BY ALLIED. FURTHERMORE, IF FOR ANY REASON ANY ONE INCREMENT MOVED WAS 10,000 BARRELS RATHER THAN 12,000 BARRELS, THE INCREASED COST WOULD BE $50, WHICH IS MORE THAN THE TOTAL POTENTIAL SAVING UNDER EASTERN'S BID.

IN ANY EVENT, EASTERN SUBMITTED THE LOW CHARGES ONLY ON THE INCREMENTS FOR 12,000 BARRELS, A BASIS NOT REQUESTED BY THE GOVERNMENT AND UPON WHICH COMPETITION WAS NOT OBTAINED. THEREFORE, A CONTRACT FOR INCREMENTS OF 12,000 BARRELS COULD NOT PROPERLY BE AWARDED TO EASTERN. ACCORDINGLY, YOUR PROTEST MUST BE DENIED.