B-174046, NOV 17, 1971

B-174046, NOV 17, 1971

BID PROTEST - ADMINISTRATIVE RECALCULATION OF BID PRICE DENIAL OF PROTEST ON BEHALF OF ARMSTRONG AND ARMSTRONG, INC., AGAINST THE PROPOSED AWARD OF A CONTRACT TO BOVEE AND CRAIL CONSTRUCTION COMPANY (BOVEE) BY THE BUREAU OF RECLAMATION, FOR THE CONSTRUCTION OF THE LAKE CHELAN PUMPING PLANT, DISCHARGE LINE, AND REGULATING TANK FOR THE MANSON UNIT, CHIEF JOSEPH DAM PROJECT, WASHINGTON. PROTESTANT CONTENDS IT WAS ERRONEOUS FOR THE CONTRACTING OFFICER TO RECALCULATE THE SCHEDULE TOTAL OF BOVEE'S UNIT PRICE EXTENSION. IN VIEW OF PARAGRAPH 14 OF THE SOLICITATION SPECIAL CONDITIONS, THE COMP. GEN. BELIEVES THAT IT IS EVIDENT THAT INDIVIDUAL ITEM PRICES ARE TO CONTROL BECAUSE THE CORRECT SCHEDULE TOTAL SERVES ONLY AS THE PRICE EVALUATION FACTOR FOR PURPOSES OF AWARD AND NOT FOR PAYMENT UNDER THE CONTRACT. HENCE, IT MAY BE CONCLUDED THAT THE INDIVIDUAL ITEM PRICES MAY BE TOTALED ADMINISTRATIVELY TO DETERMINE THE LOW BIDDER.

TO FERGUSON AND BURDELL:

REFERENCE IS MADE TO YOUR LETTER OF AUGUST 31, 1971, WITH ENCLOSURES, AND SUBSEQUENT CORRESPONDENCE, ON BEHALF OF ARMSTRONG AND ARMSTRONG, INC., (ARMSTRONG), PROTESTING THE PROPOSED AWARD OF CONTRACT TO BOVEE AND CRAIL CONSTRUCTION COMPANY (BOVEE), UNDER SPECIFICATION NO. DC 6896, ISSUED BY THE BUREAU OF RECLAMATION, DEPARTMENT OF THE INTERIOR, DENVER, COLORADO.

THE SOLICITATION REQUESTED BIDS FOR THE CONSTRUCTION OF THE LAKE CHELAN PUMPING PLANT, DISCHARGE LINE, AND REGULATING TANK FOR THE MANSON UNIT, CHIEF JOSEPH DAM PROJECT, WASHINGTON. THE BIDDING SCHEDULE CONSISTED OF 82 ITEMS OF WORK OR MATERIAL TO BE FURNISHED. LUMP-SUM PRICES WERE REQUESTED FOR SEVERAL ITEMS WHILE UNIT AND EXTENDED UNIT PRICES WERE REQUESTED FOR THE REMAINING ITEMS OF WORK, INCLUDING ITEMS 3 AND 82. THE SCHEDULE CALLED FOR A TOTAL PRICE OF ALL ITEMS.

FOURTEEN BIDS WERE RECEIVED AND OPENED ON JULY 15, 1971. THE LOW BID RECEIVED WAS THAT OF ARMSTRONG IN THE AMOUNT OF $1,415,757.55 WHILE THE SECOND LOW BID WAS THAT OF BOVEE IN THE AMOUNT OF $1,418,367.

WE ARE ADVISED THAT IMMEDIATELY AFTER BID OPENING, THE PROCUREMENT OFFICE CHECKED THE MATHEMATICAL COMPUTATIONS IN THE BIDS RECEIVED. WHILE DOING SO, IT WAS DISCOVERED THAT BOVEE HAD MADE A MISTAKE IN THE TOTAL AMOUNT OF $340 IN ITS UNIT PRICE EXTENSIONS FOR ITEMS 3 AND 82 AND HAD ALSO MADE A MISTAKE IN THE AMOUNT OF $5,000 IN THE SUMMATION FOR THE TOTAL SCHEDULE. BOVEE'S CORRECTED TOTAL WAS ACCORDINGLY REDUCED TO $1,413,027. THIS CORRECTED SUM WAS VERIFIED AND THEREAFTER ARMSTRONG WAS NOTIFIED THAT ITS EVALUATED LOW BID IN THE AMOUNT OF $1,415,757.55 HAD BEEN DISPLACED.

ARMSTRONG, BY LETTER OF JULY 23, 1971, PROTESTED TO THE PROCUREMENT ACTIVITY ITS DETERMINATION THAT BOVEE WAS THE LOW BIDDER UNDER THE SOLICITATION. BY TELEGRAM OF JULY 27, 1971, THE CONTRACTING OFFICER ADVISED ARMSTRONG THAT HE BELIEVED THAT ITS PROTEST WAS WITHOUT MERIT AND THAT THE PROCUREMENT ACTIVITY WAS PROCEEDING TO PROCESS THE BOVEE BID FOR AWARD.

WE HAVE ADVISED INFORMALLY THAT AWARD HAS BEEN MADE PURSUANT TO FEDERAL PROCUREMENT REGULATIONS (FPR) 1-2.407-8(B)(3) TO BOVEE.

WHILE YOU CONCEDE THAT THE $340 CORRECTION OF THE BOVEE EXTENDED UNIT PRICES IS PERMISSIBLE, YOU PROTEST THE ACTIONS TAKEN BY THE PROCUREMENT ACTIVITY UNDER FPR 1-2.406-2, IN RECALCULATING THE SCHEDULE TOTAL OF BOVEE'S UNIT PRICE EXTENSIONS. YOU CONTEND THAT BOVEE'S ORIGINAL SCHEDULE TOTAL BID PRICE SHOULD CONTROL RATHER THAN THE RECOMPUTED SUM OF THE CORRECTLY EXTENDED UNIT PRICES. WITHOUT RESORTING TO EXTRANEOUS EVIDENCE, YOU MAINTAIN THAT IT IS NOT POSSIBLE TO DETERMINE WHETHER THE DISCREPANCY BETWEEN THE ARITHMETIC AND THE STATED TOTALS IN THE BOVEE BID RESULTED FROM FAULTY ADDITION, AS CONTENDED, OR FROM AN ERROR IN ONE OF THE LUMP- SUM UNIT PRICES CALLED OUT BY THE INVITATION. YOU CONCLUDE THEREFORE THAT THE BOVEE'S BID IS AMBIGUOUS AND FOR REJECTION.

WE ARE OF THE OPINION, FOR THE REASONS SET OUT BELOW, THAT THE PROCUREMENT ACTIVITY ACTED PROPERLY IN RECALCULATING THE TOTAL OF BOVEE'S ITEM PRICES.

PARAGRAPH 14 OF THE SOLICITATION SPECIAL CONDITIONS PROVIDES, IN PERTINENT PART, THAT:

"THE QUANTITIES STATED IN THE SCHEDULE ARE ESTIMATED QUANTITIES FOR COMPARISON OF BIDS, *** . PAYMENT AT THE PRICES AGREED UPON WILL BE IN FULL FOR THE COMPLETED WORK *** ."

IN VIEW OF THIS PROVISION, WE BELIEVE IT IS EVIDENT THAT THE INDIVIDUAL ITEM PRICES ARE TO CONTROL BECAUSE THE CORRECT SCHEDULE TOTAL SERVES ONLY AS THE PRICE EVALUATION FACTOR FOR PURPOSES OF AWARD AND NOT FOR PAYMENT UNDER THE CONTRACT. IN OTHER WORDS, THE CONTRACTOR WILL NOT BE PAID THE EVALUATED SCHEDULE TOTAL AS A LUMP-SUM PRICE. RATHER, PAYMENT IS TO BE MADE ON THE BASIS OF THE LUMP-SUM PRICES QUOTED ON SOME ITEMS AND ON A UNIT-PRICE BASIS FOR THE REMAINING ITEMS.

HENCE, IT MAY BE CONCLUDED THAT THE INDIVIDUAL ITEM PRICES, WHETHER LUMP SUM OR FOR ESTIMATED UNIT-PRICE EXTENSIONS, PROPERLY MAY BE TOTALED ADMINISTRATIVELY FOR THE PURPOSE OF DETERMINING THE LOWEST BIDDER. THIS WAS DONE IN THE CASE OF BOVEE AND WE SEE NO LEGAL BASIS TO OBJECT TO SUCH COURSE OF ACTION.

IN YOUR CORRESPONDENCE TO OUR OFFICE AND THE PROCUREMENT ACTIVITY, YOU HAVE CITED SEVERAL OF OUR DECISIONS IN SUPPORT OF YOUR VARIOUS CONTENTIONS. YOU RELY IN PARTICULAR UPON OUR DECISION B-173178, AUGUST 20, 1971, WHICH YOU INTERPRET AS HOLDING THAT A STATED SCHEDULE TOTAL PRICE PREVAILS IN THE CASE OF A DISCREPANCY BETWEEN IT AND THE SUM TOTAL OF EXTENDED UNIT PRICES. HOWEVER, THAT CASE, WHICH INVOLVED THE SALE OF SURPLUS GOVERNMENT PROPERTY, IS DISTINGUISHABLE FROM THE PRESENT SITUATION IN THAT THE INVITATION FOR BIDS (IFB) IN THAT CASE REQUIRED THAT FOR EACH ITEM BID ON, BIDDERS WERE TO SET FORTH THEIR PRICE PER UNIT AND THEIR EXTENDED UNIT PRICE (UNIT PRICE TIMES QUANTITY). THE PROTESTANT REQUESTED CORRECTION OF A MISTAKE ALLEGED TO HAVE BEEN MADE IN HIS UNIT PRICE EXTENSION. WE HELD THAT AS THE IFB DID NOT STATE OR INDICATE WHETHER THE PRICE PER UNIT OR EXTENDED PRICE WOULD CONTROL, NEITHER WOULD BE GIVEN ANY PREFERENCE, WHEREAS IN THE INSTANT CASE, AS INDICATED ABOVE, THE SOLICITATION DOES INDICATE SUCH A PREFERENCE. BECAUSE NO PREFERENCE WAS STATED IN THE IFB IN THE CITED CASE, WE CONCLUDED THAT THE AMOUNT OF THE INTENDED BID COULD NOT BE ASCERTAINED FROM THE BID ITSELF AND SINCE CORRECTION WOULD HAVE RESULTED IN DISPLACEMENT OF A HIGHER OFFEROR, IT COULD NOT BE PERMITTED.

IN REGARD TO THE OTHER CASES YOU HAVE CITED IN SUPPORT OF YOUR CONTENTION OUR REVIEW THEREOF INDICATES THAT THEY INVOLVED SOLICITATIONS WHICH INDICATED THAT AGGREGATE OR TOTAL PRICES WOULD CONTROL, OMISSION OF UNIT PRICES, FAILURE TO VERIFY A SUSPECTED UNIT PRICE ERROR, VERIFICATION OF A UNIT PRICE MISTAKE, OR SOLICITATIONS WHICH STATED NO PREFERENCE AS BETWEEN UNIT AND EXTENDED UNIT OR TOTAL PRICES SO THAT DISCREPANCIES BETWEEN UNIT PRICES AND TOTALS RESULTED IN THE BIDS BEING DETERMINED TO BE AMBIGUOUS. THOSE DECISIONS THEREFORE ARE NOT APPLICABLE TO THE INSTANT SOLICITATION.

ACCORDINGLY, YOUR PROTEST IS DENIED.