B-169118, APR. 15, 1970

B-169118: Apr 15, 1970

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ALTHOUGH CONTRACTING OFFICER CONCEDES THAT INCLUSION OF "BRAND NAME" WAS SUPERFLUOUS IN VIEW OF DETAILED SPECIFICATIONS. WHICH IS PROPER EXERCISE OF ADMINISTRATIVE DISCRETION. SAVING OF MORE THAN 10 PERCENT IS NOT OF MINOR CONSIDERATION. EUGENE DREXLER: REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 16. THE TOTAL COST WAS ESTIMATED AT $26. IT WAS DETERMINED. THAT THERE WAS REASONABLE EXPECTATION OF A SUFFICIENT NUMBER OF BIDS FROM SMALL BUSINESS CONCERNS AT REASONABLE PRICES AND. THE PROCUREMENT WAS SET ASIDE FOR EXCLUSIVE SMALL BUSINESS PARTICIPATION. SINCE THE "EXIDE" MODEL CITED IS A PRODUCT MANUFACTURED BY A BIG BUSINESS CONCERN. REFERENCE TO THIS BRAND NAME AND MODEL WAS DELETED.

B-169118, APR. 15, 1970

BIDS--DISCARDING ALL BIDS--SPECIFICATIONS REVISION--SAVINGS TO THE GOVERNMENT UNSUCCESSFUL LOWEST RESPONSIVE BIDDER UNDER ORIGINAL INVITATION FOR BATTERY CHARGERS WHO PROTESTS CANCELLATION OF INVITATION AND RESOLICITATION UNDER REVISED SPECIFICATIONS INCLUDING "BRAND NAME OR EQUAL" IN PURCHASE DESCRIPTION, OFFERS NO BASIS FOR OBJECTION, ALTHOUGH CONTRACTING OFFICER CONCEDES THAT INCLUSION OF "BRAND NAME" WAS SUPERFLUOUS IN VIEW OF DETAILED SPECIFICATIONS, SINCE CONTRACTING OFFICER ENVISIONED AND REALIZED SAVINGS TO GOVERNMENT BY READVERTISING UNDER RELAXED SPECIFICATIONS, WHICH IS PROPER EXERCISE OF ADMINISTRATIVE DISCRETION. SAVING OF MORE THAN 10 PERCENT IS NOT OF MINOR CONSIDERATION. SEE COMP. GEN. DECS. AND CT. CASE CITED.

TO MR. EUGENE DREXLER:

REFERENCE IS MADE TO YOUR LETTER DATED FEBRUARY 16, 1970, IN BEHALF OF GALBRAITH-PILOT MARINE CORPORATION, PROTESTING CANCELLATION OF INVITATION FOR BIDS NO. N66314-70-B-1476 AND THE READVERTISEMENT UNDER INVITATION FOR BIDS NO. N66314-70-B-1581 FOR BATTERY CHARGERS ISSUED BY THE NAVAL REGIONAL PROCUREMENT OFFICE, NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA.

THE NAVAL WEAPONS STATION, CONCORD, CALIFORNIA, REQUISITIONED FROM THE NAVAL SUPPLY CENTER 28 EACH BATTERY CHARGERS EQUAL TO A CERTAIN "EXIDE" MODEL. THE TOTAL COST WAS ESTIMATED AT $26,000. IT WAS DETERMINED, BY PAST PROCUREMENT EXPERIENCE, THAT THERE WAS REASONABLE EXPECTATION OF A SUFFICIENT NUMBER OF BIDS FROM SMALL BUSINESS CONCERNS AT REASONABLE PRICES AND, THEREFORE, THE PROCUREMENT WAS SET ASIDE FOR EXCLUSIVE SMALL BUSINESS PARTICIPATION. SINCE THE "EXIDE" MODEL CITED IS A PRODUCT MANUFACTURED BY A BIG BUSINESS CONCERN, REFERENCE TO THIS BRAND NAME AND MODEL WAS DELETED, AND A DETAILED PURCHASE DESCRIPTION USED FOR THE SOLICITATION IN INVITATION FOR BIDS NO. N66314-70-B-1476. PARAGRAPH 6D OF THE SPECIFICATIONS STATED "OVERALL CABINET DIMENSIONS NOT TO EXCEED 26 1/2 INCHES IN WIDTH, 26 1/2 INCHES IN DEPTH AND 30 1/2 INCHES IN HEIGHT." PARAGRAPH 6G OF THE SPECIFICATIONS STATED THAT:

"G. CHARGERS SHALL BE EQUIPPED WITH TWO SETS OF DC OUTPUT LEADS OF #00 AWG FLAT CABLE, 15-FOOT LENGTHS WITH 150 AMP. ANDERSON TYPE EC CHARGING- HALF PLUGS. LEADS SHALL BE ARRANGED TO LEAVE THE REAR OF THE CABINET ONE INCH OR LESS FROM TOP OF CABINET. THE 15-FOOT LENGTHS OF CABLE TO BE MEASURED FROM CABINET CASE TO PLUG."

FIFTY FIRMS WERE ISSUED INVITATIONS TO BID, WITH SIX BIDS RECEIVED AND OPENED ON JANUARY 20, 1970, AS FOLLOWS:

LA MARCHE MFG. CO. $27,286.00

GOULD, INC. 28,546.00

GALBRAITH-PILOT MARINE CORP. 30,380.00

KW BATTERY COMPANY 31,962.00

SPECIALIZED ENGINEERING 32,340.00

CHRISTIE ELECTRIC CORP. 53,032.00

LA MARCHE TOOK EXCEPTION TO PARAGRAPH 6D OF THE SPECIFICATIONS, OFFERING CABINETS 27 INCHES WIDE, 27 5/8 INCHES IN DEPTH AND 28 INCHES HIGH. ADDITION, LA MARCHE STATED THAT AN ALLOWANCE OF $50 PER UNIT COULD BE MADE IF PARAGRAPH 6G OF THE SPECIFICATIONS COULD BE CHANGED TO ALLOW ROUND LEADS LEAVING EITHER ONE INCH OR FOUR INCHES FROM THE TOP OF THE CABINET, IN LIEU OF THE FLAT LEADS ARRANGED TO LEAVE THE REAR OF THE CABINET ONE INCH OR LESS FROM THE TOP OF THE CABINET. THIS BID WAS CONSIDERED NONRESPONSIVE TO THE INVITATION. THE SECOND LOW BID OF GOULD, INC; WAS NONRESPONSIVE TO THE SMALL BUSINESS SET-ASIDE PROVISION, SINCE IT IS A LARGE CONCERN. THE GALBRAITH-PILOT MARINE CORPORATION BID TOOK NO EXCEPTION TO THE SPECIFICATIONS AND WAS THE LOWEST RESPONSIVE BID RECEIVED.

THE CONTRACTING OFFICER REPORTS THAT IN VIEW OF THE PRICE DIFFERENTIAL OF APPROXIMATELY 10 PERCENT, THE SMALL DIFFERENCES IN WIDTH AND DEPTH SIZES, AND SINCE SIMILAR BATTERY CHARGERS MANUFACTURED BY LA MARCHE HAD BEEN FURNISHED THE NAVAL WEAPONS STATION IN PAST PROCUREMENTS, THAT ACTIVITY WAS REQUESTED TO RECONSIDER ITS REQUIREMENT FOR LIMITING CABINET DIMENSIONS AND TO INVESTIGATE THE NEED FOR FLAT LEADS ONE INCH OR LESS FROM THE TOP OF THE CABINET. THIS REPORT CONTINUES THAT AFTER CONSIDERABLE TECHNICAL DELIBERATION, THE NAVAL WEAPONS STATION, BY LETTER DATED JANUARY 27, 1970, AUTHORIZED REVISIONS IN SPECIFICATIONS TO RELAX THE CABINET DIMENSIONS AND CHANGE THE REQUIREMENT FOR LEADS TO BE THREE INCHES OR LESS FROM THE TOP OF THE CABINET. THE REQUIREMENT FOR FLAT LEADS WAS RETAINED. THE CONTRACTING OFFICER THEN DETERMINED, IN ACCORDANCE WITH ARMED SERVICES PROCUREMENT REGULATION 2-404.1 (B), TO CANCEL THE INVITATION AND READVERTISE THE REQUIREMENT WITH REVISED SPECIFICATIONS.

THE NEW INVITATION, IFB NO. N66314-70-B-1581, WAS ISSUED ON FEBRUARY 9, 1970, AS A 100 PERCENT SMALL BUSINESS SET-ASIDE, USING A "BRAND NAME OR EQUAL" PURCHASE DESCRIPTION, REFERENCING THE PREVIOUSLY PURCHASED LA MARCHE MODEL AS WELL AS SETTING FORTH SALIENT PHYSICAL, FUNCTIONAL, AND OTHER CHARACTERISTICS ESSENTIAL TO THE NEEDS OF THE GOVERNMENT. THE NEW INVITATION SPECIFICATIONS, ASIDE FROM CABINET DIMENSIONS AND PLACEMENT OF THE LEADS WERE THE SAME AS IN THE ORIGINAL INVITATION. THREE BIDS WERE RECEIVED ON THIS INVITATION WHICH WERE OPENED FEBRUARY 24, 1970:

GALBRAITH-PILOT MARINE CORP. $26,488.00

LA MARCHE MFG. CO. 27,123.60

SPECIALIZED ENGINEERING 32,340.00

IT IS REPORTED THAT THESE BIDS ARE BEING EVALUATED AND THAT AWARD WILL BE WITHHELD PENDING DISPOSITION OF THE PROTEST.

IT IS CONTENDED THAT THE REQUISITIONING ACTIVITY REVISED ITS SPECIFICATIONS AT THE INSISTENCE OF THE PROCURING OFFICE IN ORDER TO ALLOW LA MARCHE'S PRODUCT TO QUALIFY; THAT THE REVISIONS WERE ONLY MINOR; AND THAT THE PRICE DIFFERENTIAL WAS MINOR. IT IS FURTHER PROTESTED THAT THIS PROCUREMENT PROCESS IS HIGHLY UNORTHODOX, HIGHLY PREJUDICIAL TO GALBRAITH- PILOT, UNDULY RESTRICTIVE, AND CONFUSING AS TO THE REQUIREMENTS OF THE NEW SOLICITATION. YOU EXPRESS THE BELIEF THAT THE CONTRACTING OFFICER'S ACTIONS ARE CONTRARY TO THE SPIRIT AND INTENT OF ASPR 2-404.1; AND THAT THE READVERTISEMENT SHOULD BE CANCELLED AND AWARD MADE TO GALBRAITH-PILOT, OR, AT THE LEAST, THE "BRAND NAME" SHOULD BE DELETED FROM THE NEW PROCUREMENT.

ASPR 2-404.1 (A) PROVIDES IN EFFECT THAT AFTER BIDS HAVE BEEN OPENED AWARD MUST BE MADE TO THE LOWEST RESPONSIBLE BIDDER UNLESS THERE IS A COMPELLING REASON TO REJECT ALL BIDS AND READVERTISE. BOTH THE COURT OF CLAIMS IN MASSMAN CONSTRUCTION CO. V. UNITED STATES, 102 CT. CL. 699, AND OUR OFFICE IN NUMEROUS DECISIONS HAVE TAKEN THE SAME POSITION. SOME OF THE REASONS LISTED IN ASPR 2-404.1 (B) AS JUSTIFYING CANCELLATION OF THE INVITATION AFTER OPENING ARE THAT ALL OTHERWISE ACCEPTABLE BIDS RECEIVED ARE AT UNREASONABLE PRICES, SPECIFICATIONS HAVE BEEN REVISED, AND NEEDS OF THE GOVERNMENT CAN BE SATISFIED WITH A LESS EXPENSIVE ITEM FROM THAT ON WHICH BIDS WERE INVITED.

THE RIGHT TO REJECT ALL BIDS IS RESERVED TO THE GOVERNMENT UNDER PARAGRAPH 10 (B) OF STANDARD FORM 33A, WHICH IS PART OF THE SOLICITATION. IN ADDITION, THE HEAD OF THE AGENCY IS GIVEN THE RIGHT UNDER 10 U.S.C. 2305 (C) TO REJECT ALL BIDS WHEN HE DEEMS THAT ACTION TO BE IN THE PUBLIC INTEREST. ALSO IT HAS LONG BEEN HELD THAT THE ADVERTISING STATUTES WERE ENACTED FOR THE PROTECTION OF THE GOVERNMENT AND 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.

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) (1956).

CONTRACTING OFFICERS ARE CLOTHED WITH BROAD POWERS OF DISCRETION IN DECIDING WHETHER AN INVITATION FOR BIDS SHOULD OR SHOULD NOT BE CANCELLED AND OUR OFFICE WILL NOT INTERFERE WITH SUCH A DETERMINATION UNLESS IT IS ARBITRARY OR CAPRICIOUS AND NOT BASED ON SUBSTANTIAL EVIDENCE. 39 COMP. GEN. 396 (1959).

HERE THE CONTRACTING OFFICER ENVISIONED A SAVINGS TO THE GOVERNMENT IN THE BELIEF THAT THE ORIGINAL RESPONSIVE BIDS WERE HIGHER THAN EXPECTED AND THAT A SLIGHT RELAXATION OF THE SPECIFICATIONS WOULD ACCOMPLISH A REDUCTION IN COST ON A READVERTISING OF THE PROCUREMENT. AS INDICATED ABOVE, THIS IS A PROPER EXERCISE OF ADMINISTRATIVE DISCRETION, ABSENT FRAUD OR BAD FAITH, NEITHER OF WHICH IS APPARENT HERE. IN THIS CONNECTION, WE CANNOT AGREE THAT A SAVING OF MORE THAN 10 PERCENT IS OF MINOR CONSIDERATION. NOR CAN WE AGREE THAT THE REPROCUREMENT IS RESTRICTIVE OR CONFUSING. THE SPECIFICATIONS HAVE BEEN RELAXED IN TWO RESPECTS AND ARE OTHERWISE THE SAME AS IN THE ORIGINAL SOLICITATION.

CONCERNING YOUR OBJECTION TO THE USE OF A "BRAND NAME" IN THE READVERTISED SOLICITATION, THE CONTRACTING OFFICER CONCEDES, IN RETROSPECT, THAT THE INCLUSION OF THE BRAND NAME REFERENCE WAS SUPERFLUOUS. IN VIEW OF THE DETAILED SPECIFICATIONS WE AGREE THAT THE USE OF A BRAND NAME WAS UNNECESSARY, BUT WE FAIL TO SEE HOW IT WAS "CONFUSING" AS YOU ALLEGE.

IN THE CIRCUMSTANCES WE FIND THAT CANCELLATION OF THE INVITATION WAS A REASONABLE EXERCISE OF ADMINISTRATIVE DISCRETION.