B-170793, DEC. 11, 1970

B-170793: Dec 11, 1970

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WHERE CONTRACT CALLED FOR TWO ITEMS AND CONTRACTING OFFICER DETERMINED THAT THE LOWEST ELIGIBLE BID ON ITEM 2 WAS 127.2% HIGHER THAN THE LAST PREVIOUS AWARD THEN REJECTION OF THE BIDS AND RENEGOTIATION SUBSTANTIALLY REDUCING PRICE OF ITEM 2 OFFERED BY PROTESTANT DOES NOT REQUIRE THAT THE SAME DETERMINATION BE MADE FOR ITEM 1. ESPECIALLY WHERE THE BIDS WERE LOWER THAN THE LAST PREVIOUS AWARD ON THAT ITEM. THE INVITATION WAS ISSUED ON JUNE 23. WHEN BIDS WERE OPENED ON JULY 23. THE CONTRACTING OFFICER DETERMINED THAT THERE WERE TWO RESPONSIVE BIDS. BOYD'S UNIT PRICES WERE $1. WHILE YOUR UNIT PRICES WERE $1. FOUND THE UNIT PRICE FOR ITEM 1 WAS $1. THE UNIT PRICE FOR ITEM 2 WAS $779.73 ON MARCH 24.

B-170793, DEC. 11, 1970

BID PROTEST - NEGOTIATIONS DENIAL OF PROTEST OF HI-TORQUE MFG., CO., AGAINST THE AWARD OF A CONTRACT FOR TWO TYPES OF TOOL KITS TO BE USED IN GROUND SUPPORT OF NAVY P3C ORION AIRCRAFT PROGRAM ISSUED BY THE GENERAL SERVICES ADMINISTRATION TO ANY OTHER BIDDER. WHERE CONTRACT CALLED FOR TWO ITEMS AND CONTRACTING OFFICER DETERMINED THAT THE LOWEST ELIGIBLE BID ON ITEM 2 WAS 127.2% HIGHER THAN THE LAST PREVIOUS AWARD THEN REJECTION OF THE BIDS AND RENEGOTIATION SUBSTANTIALLY REDUCING PRICE OF ITEM 2 OFFERED BY PROTESTANT DOES NOT REQUIRE THAT THE SAME DETERMINATION BE MADE FOR ITEM 1, ESPECIALLY WHERE THE BIDS WERE LOWER THAN THE LAST PREVIOUS AWARD ON THAT ITEM.

TO HI-TORQUE MFG. CO., INC.:

WE REFER TO YOUR LETTER OF SEPTEMBER 8, 1970, PROTESTING AWARD TO ANY OTHER BIDDER UNDER IFB NO. FPNTP-B4-26277-A-7-23-70, ISSUED BY THE GENERAL SERVICES ADMINISTRATION.

THE INVITATION WAS ISSUED ON JUNE 23, 1970, FOR TWO TYPES OF TOOL KITS TO BE USED IN GROUND SUPPORT OF THE NAVY P3C ORION AIRCRAFT PROGRAM. ITEM 1 CALLED FOR 10 EPOXY REPAIR TOOL KITS AND ITEM 2 FOR 10 ELECTRONIC COMPUTER MAINTENANCE TOOL KITS. WHEN BIDS WERE OPENED ON JULY 23, 1970, THE CONTRACTING OFFICER DETERMINED THAT THERE WERE TWO RESPONSIVE BIDS, ONE FROM BOYD TOOLS, INC., AND ONE FROM YOUR COMPANY.

ON THE BASIS OF FOB DESTINATION, KANSAS CITY, MISSOURI, BOYD'S UNIT PRICES WERE $1,577.83 FOR ITEM 1 AND $1,857.59 FOR ITEM 2, WHILE YOUR UNIT PRICES WERE $1,667.00 FOR ITEM 1 AND $1,947.00 FOR ITEM 2. THE CONTRACTING OFFICER COMPARED THE BID PRICES WITH THE PRICES PAID FOR THE SAME ITEMS IN THE INITIAL PROCUREMENT FROM THE PRIME MANUFACTURER, LOCKHEED-CALIFORNIA COMPANY, AND FOUND THE UNIT PRICE FOR ITEM 1 WAS $1,773.67 ON APRIL 22, 1970, AND THE UNIT PRICE FOR ITEM 2 WAS $779.73 ON MARCH 24, 1970.

THE CONTRACTING OFFICER DETERMINED THAT BOTH RESPONSIVE BIDS FOR ITEM 2 WERE UNREASONABLE AS TO PRICE, IN THAT THE LOWEST ELIGIBLE BID WAS 127.2 PERCENT HIGHER THAN THE LAST PREVIOUS AWARD, AND REJECTED BOTH BIDS. AFTER NEGOTIATION WITH THE TWO RESPONSIVE BIDDERS AND LOCKHEED CALIFORNIA PURSUANT TO THE AUTHORITY IN SECTION 302(C)(13) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, AS AMENDED, 41 U.S.C. 252(C)(14), AN AWARD WAS MADE TO YOUR FIRM FOR ITEM 2 AT A UNIT PRICE OF $692.00.

SINCE THE CONTRACTING OFFICER HAD DETERMINED THAT BOYD'S BID ON ITEM 1 WAS REASONABLE, AND HE CONTEMPLATED MAKING AWARD THEREON UNDER THE INVITATION FOR BIDS, HE DECLINED TO ACCEPT YOUR OFFER, MADE DURING THE COURSE OF NEGOTIATIONS ON ITEM 2, TO REDUCE YOUR UNIT PRICE ON ITEM 1 BY $545.00.

YOUR PROTEST OF SEPTEMBER 8, 1970, EXPRESSED THE BELIEF THAT YOU WERE THE LOW RESPONSIVE BIDDER FOR ITEM 1 AND STATED YOUR CONTENTION THAT IT WAS ARBITRARY AND CAPRICIOUS FOR THE CONTRACTING OFFICER TO FIND THAT THE BID PRICES WERE EXCESSIVE ON ITEM 2 WITHOUT MAKING THE SAME DETERMINATION FOR ITEM 1.

YOUR BELIEF THAT YOU WERE THE LOW RESPONSIVE AND RESPONSIBLE BIDDER FOR ITEM 1 IS NOT SUPPORTED BY THE RECORD. BOYD'S BID ON THAT ITEM WAS $1,577.83 WHILE YOUR BID WAS $1,667.00. MOREOVER, THERE IS NOTHING IN THE ACTIONS OF THE CONTRACTING OFFICER WHICH COULD IN ANY MANNER BE CHARACTERIZED AS ARBITRARY OR CAPRICIOUS. THERE IS NO QUESTION BUT THAT THE BIDS FOR ITEM 2 WERE PROPERLY DETERMINED TO BE UNREASONABLY HIGH AND REJECTED, SINCE THE LOW ELIGIBLE BID WAS 127.2 PERCENT HIGHER THAN THE PRICE IN THE PREVIOUS PROCUREMENT OF THE SAME ITEM. WE FIND NO REASON, HOWEVER, IN LAW OR LOGIC, WHY THE SAME DETERMINATION SHOULD HAVE BEEN MADE FOR ITEM 1 ON THE BASIS OF THE INFORMATION AVAILABLE TO THE CONTRACTING OFFICER. THE TWO ITEMS WERE ENTIRELY DIFFERENT AND THE LOW BID FOR ITEM 1 WAS 11 PERCENT BELOW THE PRICE IN THE INITIAL PROCUREMENT. IN ADDITION, THE CONTRACTING OFFICER ANALYZED THE CATALOG PRICES OF THE VARIOUS COMPONENTS OF THE TOOL KIT IN ITEM 1 AND FOUND THAT BOYD'S BID WAS REASONABLE. IN OUR OPINION, THE ACTIONS OF THE CONTRACTING OFFICER IN FINDING ITEM 1 REASONABLE AND ITEM 2 UNREASONABLE AS TO PRICE WERE NEITHER ARBITRARY NOR CAPRICIOUS.

ALTHOUGH SECTION 1-2.305 OF THE FEDERAL PROCUREMENT REGULATIONS, AS INCORPORATED IN THIS SOLICITATION BY PARAGRAPH 8 OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS, ALLOWS A SUCCESSFUL OFFEROR (THE LOW RESPONSIVE AND RESPONSIBLE BIDDER) TO MAKE HIS OFFER MORE FAVORABLE TO THE GOVERNMENT AT ANY TIME, YOU WERE NOT THE SUCCESSFUL OFFEROR FOR ITEM 1. THERE IS NO PROVISION IN PROCUREMENT LAW OR REGULATION WHICH WOULD ENABLE YOU, AS AN UNSUCCESSFUL BIDDER, TO HAVE THE UNFAIR COMPETITIVE ADVANTAGE OF SUBMITTING A SECOND BID AFTER BID OPENING IN THE FULL KNOWLEDGE OF YOUR COMPETITOR'S LOW BID.

FOR THE REASONS STATED, WE FIND NO LEGAL BASIS UPON WHICH TO OBJECT TO THE ACTIONS OF THE CONTRACTING OFFICER AND YOUR PROTEST MUST THEREFORE BE DENIED.