B-175140, JUN 1, 1972

B-175140: Jun 1, 1972

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PROVIDED THAT "AWARDS WILL BE MADE ON THE BASIS OF THE BEST SINGLE DISCOUNT OFFERED FOR EACH SERVICE AREA FOR ALL RENTAL PERIODS SPECIFIED. THE BID SCHEDULE WAS ARRANGED IN TWO ROWS. EACH ROW WAS IN TURN DIVIDED INTO SECTIONS. AT THE END OF THE ROWS THE PHRASE "OFFEROR'S SINGLE DISCOUNT" APPEARED ABOVE A SPACE IN WHICH THE BIDDER WAS TO INSERT HIS DISCOUNT FROM THE PREDETERMINED RATE. BIDS WERE OPENED ON NOVEMBER 30. AWARD WAS INITIALLY DELAYED DUE TO A BIDDER'S REQUEST FOR A CORRECTION OF HIS BID. AFTER THIS REQUEST WAS DENIED BY THE CONTRACTING OFFICER. AWARD WAS MADE TO PAYLESS FOR THE SEATTLE INTERNATIONAL AIRPORT LOCATION WHILE CASSAN RECEIVED THE AWARD FOR DOWNTOWN SEATTLE. YOU OBJECT TO THE AWARD TO PAYLESS FOR THE AIRPORT LOCATION BASED ON THE CONTENTION THAT THE EVALUATION OF BIDS WAS INCORRECT IN THAT THE PROMPT PAYMENT DISCOUNT OFFERED BY PAYLESS SHOULD NOT HAVE BEEN CONSIDERED IN DETERMINING THE LOW BID.

B-175140, JUN 1, 1972

TO SHORT, CRESSMAN & CABLE:

WE REFER TO YOUR TELEGRAM DATED FEBRUARY 4, 1972, AND SUBSEQUENT CORRESPONDENCE PROTESTING ON BEHALF OF CASSAN ENTERPRISES, INCORPORATED, DOING BUSINESS AS DOLLAR-A-DAY RENT-A-CAR (CASSAN), AGAINST THE AWARD OF A CONTRACT TO PAYLESS CAR RENTAL SYSTEMS, INCORPORATED (PAYLESS), UNDER INVITATION FOR BIDS (IFB) NO. 10 PN-PCS 2065, ISSUED ON OCTOBER 29, 1971, BY THE GENERAL SERVICES ADMINISTRATION (GSA).

THE SUBJECT IFB REQUESTED BIDS FOR REQUIREMENTS CONTRACTS FOR MOTOR VEHICLE RENTAL IN FOURTEEN SERVICE AREAS FOR THE PERIOD MARCH 1, 1972, OR DATE OF AWARD, IF LATER, THROUGH FEBRUARY 28, 1973.

SPECIAL PROVISION 25 OF THE SOLICITATION, ENTITLED "METHOD OF AWARD", PROVIDED THAT "AWARDS WILL BE MADE ON THE BASIS OF THE BEST SINGLE DISCOUNT OFFERED FOR EACH SERVICE AREA FOR ALL RENTAL PERIODS SPECIFIED, I.E; DAILY, HOURLY, WEEKLY, AND MILEAGE, FOR ALL TYPES OF VEHICLES." THE BID SCHEDULE WAS ARRANGED IN TWO ROWS, ONE FOR EACH TYPE OF VEHICLE REQUIRED; EACH ROW WAS IN TURN DIVIDED INTO SECTIONS, EACH CONTAINING A DIFFERENT PREDETERMINED RATE FOR DAILY, HOURLY AND PER MILE RENTAL CHARGES. AT THE END OF THE ROWS THE PHRASE "OFFEROR'S SINGLE DISCOUNT" APPEARED ABOVE A SPACE IN WHICH THE BIDDER WAS TO INSERT HIS DISCOUNT FROM THE PREDETERMINED RATE.

BIDS WERE OPENED ON NOVEMBER 30, 1971. AWARD WAS INITIALLY DELAYED DUE TO A BIDDER'S REQUEST FOR A CORRECTION OF HIS BID. ON JANUARY 21, 1972, AFTER THIS REQUEST WAS DENIED BY THE CONTRACTING OFFICER, AWARD WAS MADE TO PAYLESS FOR THE SEATTLE INTERNATIONAL AIRPORT LOCATION WHILE CASSAN RECEIVED THE AWARD FOR DOWNTOWN SEATTLE. CASSAN PROTESTED THE FORMER AWARD BY LETTER OF JANUARY 25, 1972, TO THE CONTRACTING OFFICER. THE CONTRACTING OFFICER DENIED THE PROTEST BY A LETTER DATED FEBRUARY 2, 1972.

YOU OBJECT TO THE AWARD TO PAYLESS FOR THE AIRPORT LOCATION BASED ON THE CONTENTION THAT THE EVALUATION OF BIDS WAS INCORRECT IN THAT THE PROMPT PAYMENT DISCOUNT OFFERED BY PAYLESS SHOULD NOT HAVE BEEN CONSIDERED IN DETERMINING THE LOW BID.

THE TWO BIDS IN CONTENTION WERE EVALUATED AS FOLLOWS:

BIDDER TIME PAYMENT PLUS OR MINUS DISCOUNT FROM DISCOUNT FOR

DISCOUNT PREDETERMINED PRICE LIST EVALUATION

CASSAN 2% 50% 51%

20 DAYS

PAYLESS 40% 25% 55%

20 DAYS

IT IS CLEAR THAT HAD THE PROMPT PAYMENT DISCOUNT NOT BEEN EVALUATED CASSAN WOULD HAVE BEEN THE LOW BIDDER.

YOU CONTEND THAT THE GENERAL RULE REQUIRING EVALUATION OF PROMPT PAYMENT DISCOUNTS DOES NOT APPLY IN LIGHT OF THE "SINGLE DISCOUNT" PROVIDED FOR BY SPECIAL PROVISION 25 OF THE IFB. GSA, ON THE OTHER HAND, ARGUES THAT THE BEST SINGLE DISCOUNT PROVISION WAS INCLUDED IN THE INVITATION SOLELY TO ELIMINATE POSSIBLE UNBALANCED BIDDING BY PREVENTING BIDDERS FROM OFFERING VARYING DISCOUNTS FROM THE PREDETERMINED RATES FOR DIFFERING RENTAL PERIODS AND VEHICLES APPEARING IN THE SCHEDULE. ACCORDINGLY GSA CONCLUDES THAT ITS EVALUATION WAS IN ACCORDANCE WITH THE TERMS OF THE INVITATION AND THE PRONOUNCEMENTS OF THIS OFFICE WHICH NORMALLY REQUIRE THE EVALUATION OF ALL DISCOUNTS OFFERED.

SINCE THE IFB PROVIDES FOR THE INSERTION OF PROMPT PAYMENT DISCOUNTS, IT IS EVIDENT THAT THE MEANING OF PARAGRAPH 9 OF STANDARD FORM 33A ENTITLED "DISCOUNTS" MUST BE CONSIDERED. THIS CLAUSE PROHIBITS THE EVALUATION OF PROMPT PAYMENT DISCOUNTS FOR TIME PERIODS LESS THAN TWENTY DAYS, UNLESS OTHERWISE SPECIFIED. BY INFERENCE THE PROVISION REQUIRES THAT PROMPT PAYMENT DISCOUNTS FOR PERIODS OF TWENTY DAYS OR LONGER ARE TO BE CONSIDERED UNLESS THE INVITATION SPECIFICALLY PROVIDES OTHERWISE, AND WE HAVE SO HELD. SEE B-165128, OCTOBER 28, 1968. WE HAVE ALSO RULED THAT SUCH PROMPT PAYMENT DISCOUNTS MAY BE CONSIDERED EVEN THOUGH THE INVITATION DOES NOT SPECIFICALLY PROVIDE FOR THEIR CONSIDERATION. SEE 40 COMP. GEN. 518 (1961).

CONSTRUING THE SOLICITATION AS A WHOLE, WE CONCLUDE THAT THE PROVISION FOR A "BEST SINGLE DISCOUNT" SIMPLY MEANT THAT ONLY A SINGLE DISCOUNT COULD BE OFFERED FROM THE PRE-ESTABLISHED RATES FOR EACH LOCATION AND WAS NOT INTENDED, NOR COULD IT REASONABLY BE INTERPRETED, TO PRECLUDE CONSIDERATION OF PROMPT PAYMENT DISCOUNTS IN ADDITION.

WE AGREE WITH YOU AND GSA THAT THE EVALUATION OF LARGE PROMPT PAYMENT DISCOUNTS IN EXCESS OF NORMAL TRADE PRACTICES COULD RESULT IN THE FAILURE OF THE GOVERNMENT TO EARN THE DISCOUNT WHILE CONFERRING UPON THE BIDDER THE ADVANTAGE OF A FAVORABLE BID EVALUATION. ACCORDINGLY, WE SUPPORT GSA'S INTENTION TO TAKE APPROPRIATE AGENCY ACTION TO LIMIT, IN THE FUTURE, THE AMOUNT OF PROMPT PAYMENT DISCOUNT TO BE EVALUATED.

IN VIEW OF THE FOREGOING, YOUR PROTEST MUST BE DENIED.