B-175687, MAY 11, 1972

B-175687, MAY 11, 1972

PROCUREMENT LAW - FAILURE TO ACKNOWLEDGE AMENDMENT - PROPOSED WAIVER CONCERNING A PROPOSED WAIVER OF THE APPARENT LOW BIDDER'S FAILURE TO ACKNOWLEDGE AN AMENDMENT TO AN IFB ISSUED BY THE NAVAL FACILITIES ENGINEERING COMMAND. ALTHOUGH WAIVER HAS BEEN PERMITTED WHERE ITS SOLE EFFECT WOULD BE TO DECREASE CONTRACTOR COSTS, IN THE INSTANT CASE, THE AMENDMENT FOR MAKING AN EFFORT TO HIRE TRAINEES AND APPRENTICES MATERIALLY CHANGED THE ORIGINAL REQUIREMENTS. SINCE ACKNOWLEDGEMENT OF THE AMENDMENT COULD SIGNIFICANTLY INCREASE THE CONTRACTOR'S OVERALL COST OF PERFORMANCE, IT IS THE OPINION OF THE COMP. GEN. THAT THE LOW BIDDER CANNOT BE REGARDED AS ELIGIBLE FOR AWARD.

TO MR. SECRETARY:

WE REFER TO A LETTER DATED APRIL 10, 1972, FROM COUNSEL, NAVAL FACILITIES ENGINEERING COMMAND, REQUESTING OUR CONCURRENCE IN THE PROPOSED WAIVER OF THE APPARENT LOW BIDDER'S FAILURE TO ACKNOWLEDGE AMENDMENT NO. 1 UNDER INVITATION FOR BIDS (IFB) N62472-72-B-0010, ISSUED BY THE NORTHERN DIVISION OF THE COMMAND FOR THE CONSTRUCTION OF THE MARINE CORPS ADDITION TO SEWARD ARMY RESERVE TRAINING CENTER, SYRACUSE, NEW YORK.

THIS AMENDMENT REVISED STANDARD FORM 19A OF THE SUBJECT IFB BY INCORPORATING, AMONG OTHER THINGS, PROVISIONS REQUIRING THE CONTRACTOR TO MAKE A DILIGENT EFFORT TO HIRE APPRENTICES OR TRAINEES FOR WORK UNDER THE CONTRACT IN ACCORDANCE WITH CERTAIN PRESCRIBED RATIOS; TO MAINTAIN RECORDS OF EMPLOYMENT CONCERNING SUCH EFFORTS; AND TO REPORT AT THREE-MONTH INTERVALS THE STEPS TAKEN TOWARD MAKING SUCH A DILIGENT EFFORT TO THE CONTRACTING OFFICER AND THE SECRETARY OF LABOR. THE AMENDMENT FURTHER PROVIDED STANDARDS BY WHICH THE CONTRACTOR'S "DILIGENT EFFORT" TO HIRE APPRENTICES OR TRAINEES WOULD BE MEASURED.

IN VIEW OF THE ABOVE, IT IS OUR OPINION THAT THE REQUIREMENT TO MAKE SUCH DILIGENT EFFORT WOULD BECOME A MATERIAL PART OF THE CONTRACT AGAINST WHICH THE CONTRACTOR'S PERFORMANCE WILL BE JUDGED. SEE 50 COMP. GEN. 844 (1971); 51 COMP. GEN. (B-172819, DECEMBER 1, 1971); B-174259, JANUARY 5, 1972; B-174932, MARCH 3, 1972. IN THIS REGARD, IT IS THE WELL-ESTABLISHED POSITION OF THIS OFFICE THAT THERE IS NO AUTHORITY TO WAIVE A BIDDER'S FAILURE TO ACKNOWLEDGE THE RECEIPT OF INVITATION AMENDMENTS WHICH MATERIALLY CHANGE THE ORIGINAL REQUIREMENTS. B-163775, JUNE 17, 1968. ALTHOUGH WE HAVE PERMITTED THE WAIVER OF A BIDDER'S FAILURE TO ACKNOWLEDGE AN AMENDMENT WHERE THE ONLY EFFECT OF THE AMENDMENT WOULD BE TO DECREASE THE REQUIREMENTS AND, THUS, THE SUCCESSFUL BIDDER'S COSTS (B-156651, JUNE 21, 1965), IT IS CLEAR THAT THE SUBJECT AMENDMENT IMPOSED ADDITIONAL CONTRACT REQUIREMENTS AND WE BELIEVE IT IS TOO SPECULATIVE TO CONCLUDE THAT THE ONLY EFFECT OF AMENDMENT NO. 1 IN THE PRESENT CASE WOULD BE TO DECREASE THE CONTRACTOR'S COST. WHILE COUNSEL INDICATES THAT THE INCREASED COST TO THE CONTRACTOR IN COMPLYING WITH THE REQUIREMENTS COULD BE OFFSET BY THE REDUCED WAGE RATES PAID TO THE TRAINEES WHICH WOULD BE EMPLOYED, THIS CONCLUSION WOULD APPEAR TO BE ENTIRELY SPECULATIVE, SINCE IT HAS NOT BEEN ESTABLISHED THAT THE CONTRACTOR'S EFFORT WOULD BE SUCCESSFUL IN OBTAINING THE DESIRED NUMBER OF TRAINEES, OR THAT WAGES PAID TO THE TRAINEES WOULD PROVIDE A BETTER RETURN TO THE CONTRACTOR IN WORK PERFORMANCE THAN WAGES PAID FOR JOURNEYMAN LABOR.

SINCE, IN OUR VIEW, THE REQUIREMENT FOR MAKING THE PRESCRIBED EFFORT TO HIRE APPRENTICES OR TRAINEES, AND MAINTAINING RECORDS AND REPORTING IN CONNECTION THEREWITH, CONSTITUTES A MATERIAL PART OF THE CONTRACT WHICH, IN ADDITION, COULD SIGNIFICANTLY INCREASE THE CONTRACTOR'S OVERALL COST OF PERFORMANCE, IT IS OUR OPINION THAT THE LOW BIDDER CANNOT BE REGARDED AS ELIGIBLE FOR AWARD UNDER THE SUBJECT IFB.

THE FILE FORWARDED WITH THE LETTER OF APRIL 10 IS RETURNED.