B-172196, MAY 27, 1971

B-172196: May 27, 1971

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BECAUSE NEGOTIATIONS WERE HELD BETWEEN HEW AND THE D.C. IT IS THE POSITION OF HEW. THAT THERE ARE NO GROUNDS FOR WITHHOLDING FEDERAL FUNDS OR TAKING ANY OTHER ADVERSE ACTION WITH RESPECT TO THE PROJECT. TO BUILDING MAINTENANCE CORPORATION: FURTHER REFERENCE IS MADE TO YOUR LETTER OF MARCH 12. THE SPECIFIED WORK WAS THE CLEANING OF EXTERIOR SURFACES OF THE GEORGE WASHINGTON UNIVERSITY HOSPITAL AS AUTHORIZED BY DHEW'S LETTER OF JULY 31. YOUR PROTEST RELATES TO A DELAY IN MAKING THE AWARD ON THE FIRST SOLICITATION WHICH YOU STATE WAS CAUSED BY DHEW'S LOSS OF THE BIDDING PAPERS. YOU STATE YOUR BELIEF THAT THE WAGE RATES DID NOT EXPIRE BUT WERE ABOLISHED BY THE PRESIDENT'S PROCLAMATION OF FEBRUARY 23.

B-172196, MAY 27, 1971

BID PROTEST - DELAYED AWARD DECISION DENYING PROTEST BY THIRD LOW BIDDER AGAINST AWARD OF A CONTRACT TO LOW BIDDER, EV-AIR-TIGHT CAULKING COMPANY, UNDER AN IFB ISSUED BY GEORGE WASHINGTON UNIVERSITY UNDER FUNDING ASSISTANCE ARRANGEMENTS WITH HEW FOR THE CLEANING OF EXTERIOR SURFACES OF THE GEORGE WASHINGTON UNIVERSITY HOSPITAL. BECAUSE NEGOTIATIONS WERE HELD BETWEEN HEW AND THE D.C. GOVERNMENT REGARDING PARTICIPATORY FUNDING, THE DELAY BROUGHT THE PROJECT UNDER THE PRESIDENT'S SUSPENSION OF THE DAVIS-BACON ACT WHICH RESULTED IN READVERTISEMENT. HOWEVER, IT IS THE POSITION OF HEW, THE PROJECT SPONSOR, THAT THERE ARE NO GROUNDS FOR WITHHOLDING FEDERAL FUNDS OR TAKING ANY OTHER ADVERSE ACTION WITH RESPECT TO THE PROJECT.

TO BUILDING MAINTENANCE CORPORATION:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MARCH 12, 1971, PROTESTING YOUR FAILURE TO RECEIVE AN AWARD UNDER INVITATION FOR BIDS NO. PL-017, ISSUED BY GEORGE WASHINGTON UNIVERSITY UNDER FUNDING ASSISTANCE ARRANGEMENTS WITH THE DEPARTMENT OF HEALTH, EDUCATION AND WELFARE (DHEW). THIS PROCUREMENT INVOLVES THE USE OF FEDERAL FUNDS GRANTED UNDER THE DISTRICT OF COLUMBIA MEDICAL FACILITIES CONSTRUCTION ACT OF 1968, (DCMFCA), PUBLIC LAW 90-457, DATED AUGUST 3, 1968, 32 DISTRICT OF COLUMBIA CODE 301.

THE SPECIFIED WORK WAS THE CLEANING OF EXTERIOR SURFACES OF THE GEORGE WASHINGTON UNIVERSITY HOSPITAL AS AUTHORIZED BY DHEW'S LETTER OF JULY 31, 1970, UNDER THE MODERNIZATION OF FACILITIES PROVISIONS OF THE STATUTE.

YOUR PROTEST RELATES TO A DELAY IN MAKING THE AWARD ON THE FIRST SOLICITATION WHICH YOU STATE WAS CAUSED BY DHEW'S LOSS OF THE BIDDING PAPERS, RATHER THAN FROM WITHDRAWAL OF FUNDS FROM THE PROJECT OR FROM EXPIRATION OF THE WAGE RATES WHICH HAD BEEN ESTABLISHED PURSUANT TO THE DAVIS-BACON ACT AND MADE A PART OF THE SOLICITATION. YOU STATE YOUR BELIEF THAT THE WAGE RATES DID NOT EXPIRE BUT WERE ABOLISHED BY THE PRESIDENT'S PROCLAMATION OF FEBRUARY 23, 1971. IN EFFECT, YOU PROTEST THAT THE FAILURE TO MAKE AN AWARD ON THE FIRST INVITATION WAS CAUSED BY DILATORY ACTION ON THE PART OF DHEW AND THAT THIS WAS THE REAL REASON FOR THE RESOLICITATION, RATHER THAN THE PRESIDENTIAL PROCLAMATION REGARDING THE DAVIS-BACON ACT.

THE INVITATION WAS NOT ISSUED BY AN AGENCY OF THE FEDERAL GOVERNMENT BUT BY THE PROJECT SPONSOR WHICH HAD RECEIVED A MODERNIZATION GRANT UNDER P. L. 90-457. THE GRANT IS ADMINISTERED ON THE PART OF THE FEDERAL GOVERNMENT BY THE SECRETARY OF DHEW, WHO HAS THE RESPONSIBILITY FOR MAKING THE GRANT AND OBTAINING CERTAIN ASSURANCES FROM THE GRANTEE, INCLUDING THOSE WHICH PERTAIN TO COMPETITIVE BIDDING AS REQUIRED BY 42 CFR 53.128(C). THE FEDERAL GOVERNMENT IS NOT A PARTY TO ANY CONTRACTS PERFORMED IN ACCORDANCE WITH THE DCMFCA, AND ITS SOLE RESPONSIBILITY IS ONE OF DETERMINING WHETHER THERE HAS BEEN SUCH FAILURE ON THE PART OF THE GRANTEE TO SUBMIT OR COMPLY WITH THE REQUIREMENTS AS WOULD WARRANT DISAPPROVAL OF THE APPLICATION OR THE WITHHOLDING OF FEDERAL FUNDS.

THE DHEW HAS REPORTED TO THIS OFFICE THAT BIDS WERE ORIGINALLY TO BE OPENED ON OCTOBER 16, 1970; HOWEVER, SINCE NO BIDS WERE RECEIVED THE PROJECT WAS READVERTISED. BIDS ON THE READVERTISEMENT WERE OPENED ON OCTOBER 27, 1970, AND WERE FORWARDED TO THE DHEW REGIONAL OFFICE IN PHILADELPHIA FOR ADMINISTRATIVE ACTION. DISCUSSION THEN AROSE BETWEEN DHEW AND THE DISTRICT OF COLUMBIA GOVERNMENT REGARDING PARTICIPATORY FUNDING IN THIS PROJECT. ON FEBRUARY 1, 1971, THE PROJECT SPONSOR, GEORGE WASHINGTON UNIVERSITY, WAS NOTIFIED TO MAKE THE AWARD ON THE BASIS OF THE LOWEST BID SUBMITTED. HOWEVER, A FURTHER DELAY IN AWARDING THE CONTRACT BROUGHT THE PROJECT UNDER THE PRESIDENT'S SUSPENSION OF THE DAVIS-BACON ACT, WHICH WAS ACCOMPLISHED PURSUANT TO AUTHORITY SET OUT IN 40 U.S.C. 276A-5. AS A RESULT THE UNIVERSITY WAS REQUIRED TO DELETE THE PROVISIONS OF THE DAVIS-BACON ACT AND RESOLICIT BIDS FOR THE PROJECT. BIDS WERE OPENED ON MARCH 12, 1971, ON THE READVERTISEMENT. THE LOW BIDDER THEREON IS EV-AIR-TIGHT CAULKING COMPANY, IN THE AMOUNT OF $15,900. YOUR COMPANY WAS THIRD LOW BIDDER IN THE AMOUNT OF $19,233. THE UNIVERSITY RECOMMENDED THAT AWARD BE MADE TO THE LOW BIDDER ON THE READVERTISEMENT AND DHEW CONCURRED IN THE AWARD. AWARD WAS THEREFORE MADE ON APRIL 27, 1971.

FROM THE FOREGOING IT WOULD APPEAR THAT THE DELAYS WERE OCCASIONED, AS REPORTED, BY THE FUNDING NEGOTIATIONS AND BY THE COMPLIANCES IN CONNECTION WITH THE REQUIRED ASSURANCES FROM THE GRANTEE. WHILE SUCH DELAYS ARE REGRETTED, IT IS THE POSITION OF DHEW THAT THERE IS NOTHING IN THE CIRCUMSTANCES WHICH FURNISHES ANY GROUNDS FOR WITHHOLDING FEDERAL FUNDS OR TAKING ANY OTHER ADVERSE ACTION WITH RESPECT TO THE PROJECT.

AUTHORITY FOR THE ACTION TAKEN BY THE FUNDING AGENCY STEMS FROM THE DAVIS -BACON ACT ITSELF, SECTION 6 OF WHICH PROVIDES:

"IN THE EVENT OF A NATIONAL EMERGENCY THE PRESIDENT IS AUTHORIZED TO SUSPEND THE PROVISIONS OF THIS ACT."

SUSPENSION ACTION WAS TAKEN THEREUNDER BY PRESIDENTIAL PROCLAMATION 1031, DATED FEBRUARY 23, 1971, COPY ENCLOSED.

ON FEBRUARY 25, 1971, THE ACTING ADMINISTRATOR, GENERAL SERVICES ADMINISTRATION, ISSUED INSTRUCTIONS IN IMPLEMENTATION OF THE PROCLAMATION. THESE INSTRUCTIONS SUSPENDED THE DAVIS-BACON ACT REQUIREMENTS AS CONTAINED IN THE FEDERAL PROCUREMENT REGULATIONS (FPR) AND SET OUT PROCEDURES TO BE FOLLOWED IN FEDERALLY-ASSISTED CONSTRUCTION WITH RESPECT TO INVITATIONS WHICH HAD SOLICITED BIDS BASED UPON COMPLIANCE WITH THE ACT. A COPY OF THE FEBRUARY 25 INSTRUCTIONS IS ALSO ENCLOSED.

THE ACTION OF THE PRESIDENT, AS SET OUT IN PROCLAMATION 4031, WAS AUTHORIZED BY STATUTE, AND THE INSTRUCTIONS OF FEBRUARY 25, APPEAR TO BE A PROPER IMPLEMENTATION OF THAT PORTION OF THE PROCLAMATION WHICH SUSPENDS THE PROVISIONS OF THE DAVIS-BACON ACT WITH RESPECT TO ALL CONTRACTS ENTERED INTO SUBSEQUENT TO THE DATE OF THE PROCLAMATION. IN VIEW THEREOF, AND SINCE THE DELAYS UPON WHICH THE PROTEST IS BASED APPEAR TO HAVE RESULTED FROM THE NATURE OF THE FUNDING APPROVAL INVOLVED, WE ARE UNABLE TO CONCLUDE THAT CANCELLATION OF THE ORIGINAL SOLICITATION, OR THE REJECTION OF BIDS RECEIVED THEREUNDER, WAS IMPROPER.

ACCORDINGLY, YOUR PROTEST IS DENIED.