B-171813, FEB 19, 1971, 50 COMP GEN 583

B-171813: Feb 19, 1971

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DID NOT CONFORM WITH THE REQUIREMENTS IN 41 U.S.C. 253(B) THAT AWARD SHOULD BE MADE TO THE RESPONSIBLE BIDDER WHOSE BID "WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT. AN AWARD FOR THE FACILITIES AND ADDITIVES TO THE LOWEST OVERALL BIDDER WHO WAS NOT LOW ON THE BASE BID WOULD BE PROPER AND IN ACCORD WITH SECTION 253(B). WHICH IS THE PURPOSE OF THE PUBLIC PROCUREMENT STATUTES. THE FOLLOWING AWARD PROVISIONS WERE SET FORTH IN THE INVITATION'S BID SCHEDULE: A. BASE BID NOTE. - AWARD OF THIS CONTRACT WILL BE MADE ON THE LOWEST RESPONSIVE BID FOR BASE BID ITEM A. ADDITIVE BID ITEMS INSTRUCTIONS BIDDERS ARE REQUESTED TO SUBMIT A LUMP-SUM OFFER FOR EACH OF THE ITEMS LISTED BELOW. IF APPROPRIATED FUNDS ARE AVAILABLE FOR THIS PROJECT.

B-171813, FEB 19, 1971, 50 COMP GEN 583

BIDS - EVALUATION - AGGREGATE V SEPARABLE ITEMS, PRICES, ETC. - EVALUATION FORMULA ERRONEOUS AN INVITATION FOR BIDS ISSUED PURSUANT TO 41 U.S.C. 252(C) THAT REQUESTED LUMP-SUM BIDS FOR THE CONSTRUCTION OF CAMPUS FACILITIES (BASE BID), PLUS BIDS ON EACH OF FOUR ADDITIVE ITEMS, AND INDICATED AN AWARD FOR THE BASE BID, PLUS ADDITIVES, IF ANY, WOULD BE MADE TO THE LOW BIDDER ON THE BASE BID WITHOUT REGARD TO HIS OVERALL BID PRICE, DID NOT CONFORM WITH THE REQUIREMENTS IN 41 U.S.C. 253(B) THAT AWARD SHOULD BE MADE TO THE RESPONSIBLE BIDDER WHOSE BID "WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED." THEREFORE, AN AWARD FOR THE FACILITIES AND ADDITIVES TO THE LOWEST OVERALL BIDDER WHO WAS NOT LOW ON THE BASE BID WOULD BE PROPER AND IN ACCORD WITH SECTION 253(B), AS THE LOWEST BIDDER MUST BE MEASURED BY THE TOTAL WORK TO BE AWARDED IN ORDER TO OBTAIN THE BENEFITS OF FULL COMPETITION, WHICH IS THE PURPOSE OF THE PUBLIC PROCUREMENT STATUTES.

TO THE SECRETARY OF AGRICULTURE, FEBRUARY 19, 1971:

BY LETTER OF JANUARY 26, 1971, COPY ENCLOSED, MR. CHARLES J. PETERSON, CONTRACTING OFFICER, PACIFIC NORTHWEST FOREST AND RANGE EXPERIMENT STATION, PORTLAND, OREGON, REQUESTED OUR DECISION PERMITTING HIM TO AWARD A CONTRACT TO BATTERMAN CONSTRUCTION COMPANY FOR THE FIVE BID ITEMS UNDER INVITATION FOR BIDS NO. PNW-71-1, ISSUED DECEMBER 10, 1970, FOR THE CONSTRUCTION OF CERTAIN FACILITIES AT THE OREGON STATE UNIVERSITY CAMPUS, CORVALLIS, OREGON.

THE INVITATION REQUESTED LUMP-SUM BIDS FOR THE MAJOR CONSTRUCTION REQUIREMENTS SET FORTH IN ITEM A (BASE BID) PLUS BIDS ON EACH OF FOUR ADDITIVE ITEMS UNDER ITEM B. THE FOLLOWING AWARD PROVISIONS WERE SET FORTH IN THE INVITATION'S BID SCHEDULE:

A. BASE BID

NOTE. - AWARD OF THIS CONTRACT WILL BE MADE ON THE LOWEST RESPONSIVE BID FOR BASE BID ITEM A.

BIDS MUST BE SUBMITTED FOR BOTH THE BASE BID AND ADDITIVE BID ITEMS IN ORDER FOR A BID TO BE CONSIDERED RESPONSIVE.

ADDITIVE BID ITEMS INSTRUCTIONS

BIDDERS ARE REQUESTED TO SUBMIT A LUMP-SUM OFFER FOR EACH OF THE ITEMS LISTED BELOW. IF APPROPRIATED FUNDS ARE AVAILABLE FOR THIS PROJECT, THE GOVERNMENT RESERVES THE RIGHT TO ADD TO ITEM A. BASE BID OFFER ANY SINGLE ADDITIVE ITEM OR ANY GROUP OF ADDITIVE ITEMS. SEPARATE AWARDS WILL NOT BE MADE.

ON JANUARY 19, 1971, THE EIGHT BIDS RECEIVED WERE OPENED AND RECORDED AS FOLLOWS:

BASE BID BASE BID PLUS ADDITIVES

BATTERMAN CONSTRUCTION COMPANY 293,300 428,200

MATHIS CONSTRUCTION COMPANY 301,880 437,821

WILSON CONSTRUCTION COMPANY 299,960 465,985

STRANDBERG CONSTRUCTION COMPANY 249,500 507,500

CONTRACTORS, INC. 312,200 461,000

LANTZ CONSTRUCTION COMPANY 318,650 473,343

TEE & JAY CONSTRUCTION COMPANY 291,657 441,496

VIK CONSTRUCTION COMPANY 307,805 455,064

IT WILL BE OBSERVED THAT THE BATTERMAN CONSTRUCTION COMPANY (BATTERMAN) SUBMITTED THE LOWEST OVERALL BID FOR THE BASE WORK (ITEM A) PLUS THE FOUR ADDITIVES, WHILE STRANDBERG CONSTRUCTION COMPANY (STRANDBERG) AND TEE AND JAY CONSTRUCTION COMPANY (TEE & JAY) SUBMITTED LOWER BIDS THAN BATTERMAN FOR THE BASE WORK ONLY.

THE CONTRACTING OFFICER STATES THAT A STRICT INTERPRETATION OF THE BID SCHEDULE'S AWARD PROVISIONS WOULD INDICATE THAT AN AWARD SHOULD BE MADE TO STRANDBERG AS THE APPARENT LOW BIDDER ON THE BASE WORK. HOWEVER, IT IS FURTHER STATED THAT AT THE TIME THE INVITATION WAS ISSUED THE FOREST SERVICE CONTEMPLATED THAT AN AWARD WOULD OBTAIN THE COMPLETE CONSTRUCTION PACKAGE (BASE WORK PLUS ADDITIVES), CONSISTENT WITH THE TOTAL APPROPRIATED FUNDS ($460,000) AVAILABLE. SINCE THE LOW OVERALL BID IS WELL WITHIN THE FUNDS LIMITATION, IT IS STATED THAT AN AWARD TO OTHER THAN BATTERMAN WOULD NOT BE IN CONSONANCE WITH THE ORIGINAL INTENT IN RELEASING THE INVITATION, NOR WOULD IT PERMIT THE GOVERNMENT TO OBTAIN THE "TOTAL AND MOST ECONOMICAL PRODUCT FROM AN OVERALL COMPETITIVE BASIS."

THE SOLICITATION WAS ISSUED PURSUANT TO THE AUTHORITY OF 41 U.S.C. 252(C) WHICH STATES IN PERTINENT PART:

(C) ALL PURCHASES AND CONTRACTS FOR PROPERTY AND SERVICES SHALL BE MADE BY ADVERTISING, AS PROVIDED IN SECTION 253 OF THIS TITLE ...

CONTRACTS AWARDED PURSUANT TO THAT AUTHORITY MUST CONFORM TO THE REQUIREMENTS OF 41 U.S.C. 253(B) WHICH PROVIDES IN PERTINENT PART:

*** AWARD SHALL BE MADE WITH REASONABLE PROMPTNESS BY WRITTEN NOTICE TO THAT RESPONSIBLE BIDDER WHOSE BID, CONFORMING TO THE INVITATION FOR BIDS, WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED ...

THE SUBSTANCE OF THIS PROVISION IS SET OUT IN PARAGRAPH 10(A) OF STANDARD FORM 22 (OCTOBER 1969 EDITION), WHICH IS INCLUDED IN THE INVITATION DOCUMENTS.

IN THIS CONNECTION, OUR OFFICE HAS HELD THAT THE QUOTED PROVISION REQUIRES THAT AWARD IN AN ADVERTISED PROCUREMENT, IF ANY, BE MADE TO THE LOWEST RESPONSIVE AND RESPONSIBLE BIDDER. 37 COMP. GEN. 330 (1957); 28 COMP. GEN. 662 (1949). THE LOWEST BIDDER MUST BE MEASURED BY THE TOTAL WORK TO BE AWARDED. ANY MEASURE WHICH INCORPORATES MORE OR LESS THAN THE WORK TO BE CONTRACTED FOR IN SELECTING THE LOWEST BIDDER DOES NOT OBTAIN THE BENEFITS OF FULL COMPETITION WHICH IS ONE OF THE CHIEF PURPOSES OF THE PUBLIC PROCUREMENT STATUTES. SEE UNITED STATES V BROOKRIDGE FARM, 111 F. 2D 461 (1940). IF AWARD IS TO BE MADE ON FIVE ITEMS, AWARD FOR ALL ITEMS TO THE BIDDER WHO IS LOW ON ONE OF THE ITEMS WITHOUT REGARD TO HIS RELATIVE STANDING AS TO THE OTHER ITEMS CANNOT BE CONSIDERED AN AWARD TO THE "LOWEST BIDDER" UNDER ANY REASONABLE INTERPRETATION OF THAT TERM.

IN VIEW OF THE FOREGOING, IT IS AT LEAST DOUBTFUL THAT THE AWARD PROVISIONS IN THE BID SCHEDULE OF THE SUBJECT INVITATION ARE IN CONFORMITY WITH THE REQUIREMENTS SET FORTH IN 41 U.S.C. 253(B), AND PARAGRAPH 10(A) OF STANDARD FORM 22, SINCE THE BID SCHEDULE PROVISIONS INDICATE THAT AN AWARD FOR ITEM A PLUS ADDITIVES, IF ANY, WILL BE MADE TO THE LOW BIDDER ON THAT ITEM WITHOUT REGARD TO HIS OVERALL BID PRICE.

IN VIEW THEREOF, AND SINCE THE RECORD DOES NOT SHOW THAT COMPETITION FOR THE TOTAL WORK WAS ADVERSELY AFFECTED BY THE AWARD PROVISIONS OF THE BID SCHEDULE, WE BELIEVE THAT AN AWARD SHOULD PROPERLY BE MADE TO THE LOWEST OVERALL BIDDER, OTHERWISE ELIGIBLE FOR THE AWARD, AS PROPOSED BY THE CONTRACTING OFFICER.

REMEDIAL ACTION SHOULD BE TAKEN TO PREVENT A REPETITION OF THIS CIRCUMSTANCE IN FUTURE PROCUREMENTS.

THE FILE RECEIVED WITH THE LETTER OF JANUARY 26 IS FORWARDED FOR RETURN TO THE CONTRACTING OFFICER.