B-173475(1), OCT 22, 1971

B-173475(1): Oct 22, 1971

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THE FAILURE OF THE BIDDER TO SIGN MAY BE WAIVED AS A MINOR INFORMALITY IF THE BOND IS OTHERWISE IN ORDER. REJECTION OF LANDIS' BID WAS ERRONEOUS. JR.: FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 1. EACH BIDDER WAS REQUIRED TO SUBMIT A BID BOND WITH ITS BID. THE TWO BIDS RECEIVED WERE OPENED AS SCHEDULED ON JUNE 24. THE ADMINISTRATIVE REPORT STATES THAT LANDIS WAS NOTIFIED BY TELEPHONE ON JUNE 25. THAT ITS BID WAS CONSIDERED NONRESPONSIVE BECAUSE IT HAD NOT SIGNED ITS BID BOND AS REQUIRED. WE ARE ADVISED THAT FISCAL YEAR FUNDS WERE AVAILABLE FOR THIS PROJECT AND AN AWARD HAD TO BE MADE IMMEDIATELY TO PREVENT THE FUNDS FROM LAPSING. WHICH WAS RECEIVED IN OUR OFFICE ON JULY 2. WHICH PROVIDES THAT WHERE A BID GUARANTEE IS REQUIRED AND THE BIDDER FAILS TO FURNISH IT IN ACCORDANCE WITH THE REQUIREMENTS OF THE INVITATION FOR BIDS.

B-173475(1), OCT 22, 1971

BID PROTEST - UNSIGNED BID BOND DECISION DENYING PROTEST ON BEHALF OF LANDIS CONSTRUCTION COMPANY, INC., AGAINST THE AWARD OF A CONTRACT TO A HIGHER BIDDER UNDER AN IFB ISSUED BY THE AGRICULTURAL RESEARCH SERVICE, NEW ORLEANS, LA. A BID BOND NOT SIGNED BY THE BIDDER, BUT ACCOMPANIED BY A SIGNED BID IDENTIFYING THE BOND MAY BE CONSIDERED VALID, AND THE FAILURE OF THE BIDDER TO SIGN MAY BE WAIVED AS A MINOR INFORMALITY IF THE BOND IS OTHERWISE IN ORDER. THEREFORE, REJECTION OF LANDIS' BID WAS ERRONEOUS. HOWEVER, GAO DOES NOT BELIEVE THAT A CANCELLATION IN THIS INSTANCE WOULD BE BENEFICIAL TO LANDIS OR IN THE INTEREST OF THE GOVERNMENT.

TO RALPH C. NASH, JR.:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED JULY 1, 1971, PROTESTING ON BEHALF OF LANDIS CONSTRUCTION COMPANY, INCORPORATED, AGAINST THE AWARD OF A CONTRACT TO A HIGHER BIDDER UNDER INVITATION FOR BIDS NO. ARS-109-B- 71, ISSUED BY THE AGRICULTURAL RESEARCH SERVICE, UNITED STATES DEPARTMENT OF AGRICULTURE, NEW ORLEANS, LOUISIANA.

THE INVITATION, DATED MAY 27, 1971, REQUESTED BIDS FOR THE ALTERATION OF CERTAIN ROOMS INTO A FOOD PROCESSING AND MILLING LABORATORY. EACH BIDDER WAS REQUIRED TO SUBMIT A BID BOND WITH ITS BID. THE TWO BIDS RECEIVED WERE OPENED AS SCHEDULED ON JUNE 24, 1971. LANDIS SUBMITTED THE LOW BID IN THE AMOUNT OF $74,400, AS COMPARED TO THE GURTLER, HEBERT AND COMPANY BID OF $78,500. THE ADMINISTRATIVE REPORT STATES THAT LANDIS WAS NOTIFIED BY TELEPHONE ON JUNE 25, 1971, THAT ITS BID WAS CONSIDERED NONRESPONSIVE BECAUSE IT HAD NOT SIGNED ITS BID BOND AS REQUIRED, AND THAT AN AWARD WOULD BE MADE THAT SAME DAY TO GURTLER, HEBERT AND COMPANY. IN THIS REGARD, WE ARE ADVISED THAT FISCAL YEAR FUNDS WERE AVAILABLE FOR THIS PROJECT AND AN AWARD HAD TO BE MADE IMMEDIATELY TO PREVENT THE FUNDS FROM LAPSING. LANDIS PROTESTED BY LETTER DATED JUNE 30, 1971, WHICH WAS RECEIVED IN OUR OFFICE ON JULY 2, 1971.

THE CONTRACTING OFFICER RELIES UPON A STRICT INTERPRETATION OF THE FEDERAL PROCUREMENT REGULATIONS (FPR), WHICH PROVIDES THAT WHERE A BID GUARANTEE IS REQUIRED AND THE BIDDER FAILS TO FURNISH IT IN ACCORDANCE WITH THE REQUIREMENTS OF THE INVITATION FOR BIDS, THE BID MUST BE REJECTED (WITH CERTAIN EXCEPTIONS NOT MATERIAL HERE). FPR 1-2.404 2(F).

WHILE, AS STATED, THE BOND WAS NOT SIGNED BY A PRINCIPAL OF THE CORPORATION, IT WAS SUBMITTED WITH A SIGNED BID WHICH INCLUDED A TYPED STATEMENT FROM THE BIDDER THAT A 20 PERCENT BID BOND WAS ENCLOSED. THE BID BOND FORM CONTAINED THE SIGNATURE OF THE SURETY, THE CONTRACTOR'S NAME AND ADDRESS, THE IFB NUMBER AND THE PENAL SUM OF THE BOND. WE HAVE HELD THAT AN UNSIGNED BID MAY BE CONSIDERED FOR AWARD IF ACCOMPANIED BY A LETTER, BOND OR OTHER DOCUMENT SIGNED BY THE BIDDER CLEARLY EVINCING HIS INTENT TO SUBMIT THE BID. 36 COMP. GEN. 523, 525 (1957). CONVERSELY, WE HAVE HELD THAT A BID BOND NOT SIGNED BY THE BIDDER BUT ACCOMPANIED BY A SIGNED BID IDENTIFYING THE BID BOND MAY BE CONSIDERED VALID, AND THE FAILURE OF THE BIDDER TO SIGN THE BOND MAY BE WAIVED AS A MINOR INFORMALITY IF THE BID BOND IS OTHERWISE IN ORDER. B 164453, JULY 16, 1968.

IN OUR VIEW, IF THE SURETY WOULD BE LIABLE ON THE BOND IN ACCORDANCE WITH ITS TERMS, THE FAILURE OF THE PRINCIPAL TO SIGN THE BOND DOES NOT ADVERSELY AFFECT THE RESPONSIVENESS OF THE BID. IN THESE CIRCUMSTANCES, AS IN B-164453, WE FIND NO BASIS TO QUESTION THE LIABILITY OF THE SURETY ON THE BOND MERELY BECAUSE IT WAS NOT SIGNED BY THE BIDDER. THEREFORE, LANDIS' FAILURE TO SIGN THE BID BOND SHOULD HAVE BEEN WAIVED AS A MINOR INFORMALITY. WE ARE CALLING THE MATTER TO THE ATTENTION OF THE SECRETARY TO INSURE THAT THE RULE IS PROPERLY APPLIED IN THE FUTURE.

HOWEVER, IF THE AWARD WERE TO BE CANCELLED, THE FISCAL YEAR 1971 FUNDS CONTEMPLATED FOR USE IN THE PROCUREMENT WOULD NOT HAVE BEEN VALIDLY OBLIGATED BY THE END OF THE FISCAL YEAR AND WOULD NOT BE AVAILABLE FOR A REPROCUREMENT OF THE WORK. SEE 40 COMP. GEN. 147 (1960); 38 COMP. GEN. 190 (1958). WE HAVE BEEN INFORMALLY ADVISED THAT THERE ARE NO CURRENT FISCAL YEAR FUNDS AVAILABLE. THEREFORE, AND SINCE THE FACILITY IS URGENTLY NEEDED, WE DO NOT BELIEVE THAT A CANCELLATION IN THIS INSTANCE WOULD BE BENEFICIAL TO LANDIS OR IN THE INTEREST OF THE GOVERNMENT.