B-175817, AUG 14, 1972

B-175817: Aug 14, 1972

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ALL BIDS WERE REJECTED AND THE IFB CANCELLED BECAUSE THE CONTRACTING OFFICER CONCLUDED THAT BID PRICES WERE EXCESSIVE. SINCE PROTESTANT'S BID WAS 64 PERCENT HIGHER THAN CURRENT CONTRACT PRICES ON THESE ITEMS AND SINCE THE LOW BIDS RECEIVED IN THE SECOND SOLICITATION WERE 40 PERCENT LOWER THAN PROTESTANT'S BIDS UNDER THE FIRST SOLICITATION. HIS ACTION IS AFFIRMED AND THE PROTEST DENIED. INC.: REFERENCE IS MADE TO YOUR TELEGRAM OF APRIL 27. THE SUBJECT IFB WAS ISSUED FEBRUARY 24. IT WAS ASCERTAINED THAT YOUR FIRM WAS THE LOW BIDDER ON ITEMS 1. IT WAS RECOMMENDED THAT NO AWARD BE MADE FOR ITEMS 1 AND 2. THE REASON STIPULATED WAS THAT THE PRICES RECEIVED WERE APPROXIMATELY 64 PERCENT HIGHER THAN CURRENT CONTRACT PRICES.

B-175817, AUG 14, 1972

BID PROTEST - IFB CANCELLATION - EXCESSIVE PRICE DECISION DENYING PROTEST OF SCULPTURAL PROMOTIONS, INC., AGAINST REJECTION OF ITS LOW BID UNDER AN IFB ISSUED BY GSA, FORT WORTH, TEX., FOR CERTAIN WALL PLAQUES, IDENTIFICATION PLATES, ETC., RESOLICITATION THEREOF, AND SUBSEQUENT AWARD OF THIS REQUIREMENTS CONTRACT TO ANOTHER FIRM. ALL BIDS WERE REJECTED AND THE IFB CANCELLED BECAUSE THE CONTRACTING OFFICER CONCLUDED THAT BID PRICES WERE EXCESSIVE. SINCE PROTESTANT'S BID WAS 64 PERCENT HIGHER THAN CURRENT CONTRACT PRICES ON THESE ITEMS AND SINCE THE LOW BIDS RECEIVED IN THE SECOND SOLICITATION WERE 40 PERCENT LOWER THAN PROTESTANT'S BIDS UNDER THE FIRST SOLICITATION, THE COMP. GEN. CANNOT CONCLUDE THAT THE CONTRACTING OFFICER ACTED ARBITRARILY OR CAPRICIOUSLY. THEREFORE, HIS ACTION IS AFFIRMED AND THE PROTEST DENIED.

TO SCULPTURAL PROMOTIONS, INC.:

REFERENCE IS MADE TO YOUR TELEGRAM OF APRIL 27, 1972, AND SUBSEQUENT CORRESPONDENCE IN WHICH YOU PROTEST THE REJECTION OF YOUR BID UNDER INVITATION FOR BIDS NO. 7PR-W-68886/3P/7AB, AS WELL AS THE SUBSEQUENT READVERTISEMENT OF THE SOLICITATION.

THE SUBJECT IFB WAS ISSUED FEBRUARY 24, 1972, BY THE GENERAL SERVICES ADMINISTRATION, FORT WORTH, TEXAS, CONTEMPLATING A REQUIREMENTS CONTRACT FOR THE SUPPLY OF ESTIMATED AMOUNTS OF SPECIFIED WALL PLAQUES, PLATE DESIGNATIONS, IDENTIFICATION PLATES, AND INSTRUCTION PLATES.

UPON THE OPENING OF BIDS ON MARCH 24, 1972, IT WAS ASCERTAINED THAT YOUR FIRM WAS THE LOW BIDDER ON ITEMS 1, 2, AND 3. BY LETTER DATED APRIL 11, 1972, YOU VERIFIED YOUR PRICES ON ALL THREE ITEMS, WITH YOUR PRICES ON ITEMS 1 AND 2 BEING MORE THAN 50 PERCENT BELOW THOSE OF THE NEXT LOWEST BIDDER.

ON APRIL 17, 1972, IT WAS RECOMMENDED THAT NO AWARD BE MADE FOR ITEMS 1 AND 2, WHICH CONSTITUTED AN ESTIMATED QUANTITY OF 700 9905-151-5615 ORGANIZATIONAL PLAQUES, TYPE II, AND AN ESTIMATED 550 9905-766-0426 AIR FORCE PLAQUES. THE REASON STIPULATED WAS THAT THE PRICES RECEIVED WERE APPROXIMATELY 64 PERCENT HIGHER THAN CURRENT CONTRACT PRICES. (IT IS INDICATED THAT THE CURRENT CONTRACTOR DID NOT SUBMIT A BID BECAUSE IT DID NOT RECEIVE A COPY OF THE SUBJECT IFB.) BY LETTER DATED APRIL 18, 1972, THE CONTRACTING OFFICER ADVISED YOU OF THE REJECTION OF YOUR BID FOR ITEMS 1 AND 2 ON THE BASIS THAT YOUR PRICES HAD BEEN DETERMINED TO BE EXCESSIVELY HIGH.

ON MAY 9, 1972, THE PROCURING ACTIVITY READVERTISED ITEMS 1 AND 2 UNDER INVITATION FOR BIDS NO. 7PR-W-68886-A/3P/7AB. THE RECORD STATES THAT BIDS UNDER THE READVERTISED IFB WERE OPENED JUNE 14, 1972, AND THAT FIVE OF THE SUBMITTED BIDS WERE SIGNIFICANTLY BELOW THE PRICES WHICH YOU SUBMITTED UNDER THE ORIGINAL IFB. A MEMORANDUM IN THE RECORD INDICATES LOW BIDS OF $5.30 AND $5.35 FOR ITEMS 1 AND 2 UNDER THE READVERTISED SOLICITATION AS OPPOSED TO YOUR PRICE OF $10 PER ITEM FOR EACH ITEM UNDER THE ORIGINAL IFB.

YOU HAVE OBJECTED TO THE DETERMINATION THAT YOUR PRICES UNDER THE ORIGINAL IFB WERE EXCESSIVE, AND YOU HAVE REQUESTED CANCELLATION OF THE READVERTISED IFB AND THE CONSUMMATION OF AN AWARD WITH YOUR FIRM AS THE LOWEST BIDDER UNDER THE ORIGINAL IFB. YOU HAVE FURTHER IMPLIED THAT THE CURRENT CONTRACTOR HAS BEEN SUPPLYING INFERIOR ITEMS AND MAKING SPORADIC DELIVERIES.

THE RIGHT TO REJECT ANY OR ALL BIDS WAS RESERVED TO THE GOVERNMENT UNDER PARAGRAPH 10(B) OF THE STANDARD FORM 33A, WHICH WAS A PART OF THE ORIGINAL IFB. IN ADDITION, FEDERAL PROCUREMENT REGULATIONS (FPR) 1 2.404-1(B)(5) PERMITS THE CANCELLATION OF AN IFB WHERE ALL OTHERWISE ACCEPTABLE BIDS ARE RECEIVED AT UNREASONABLE PRICES.

OUR OFFICE HAS STATED THAT THE QUESTION WHETHER A BID IS UNREASONABLE AS TO PRICE IS A MATTER FOR DETERMINATION BY THE PROCURING ACTIVITY, AND INTERVENTION BY OUR OFFICE IS NOT WARRANTED ABSENT A SHOWING THAT THE DETERMINATION WAS ARRIVED AT ARBITRARILY, CAPRICIOUSLY, OR IN BAD FAITH. B-172714, AUGUST 24, 1971. ALSO, IN 36 COMP. GEN. 364, 365-366 (1956), WE EXPRESSED THE VIEW THAT WHEN IN THE LIGHT OF ALL THE FACTS, INCLUDING THOSE DISCLOSED BY THE BIDDING, IT IS ADMINISTRATIVELY DETERMINED THAT THE LOWEST ACCEPTABLE BID IS IN EXCESS OF THE AMOUNT FOR WHICH THE GOVERNMENT SHOULD BE ABLE TO OBTAIN THE SUPPLIES OR SERVICES SOUGHT, THE REJECTION OF ALL BIDS AND READVERTISEMENT OF THE CONTRACT IS A PROPER EXERCISE OF ADMINISTRATIVE DISCRETION. IN THIS REGARD, WE HAVE CONSIDERED THE CANCELLATION OF A SOLICITATION TO BE JUSTIFIED WHERE THE ONLY ELIGIBLE BIDDER'S PRICES AVERAGED 11 PERCENT HIGHER THAN THOSE FOR THE SAME SUPPLIES UNDER A RECENT CONTRACT. B 169712, AUGUST 11, 1970.

SINCE YOUR PRICES UNDER THE ORIGINAL IFB WERE REPORTED TO BE APPROXIMATELY 64 PERCENT HIGHER THAN CURRENT CONTRACT PRICES, WE CANNOT CONCLUDE THAT THE CANCELLATION OF THAT IFB WAS AN ABUSE OF ADMINISTRATIVE DISCRETION. TO THE CONTRARY, FROM THE FACT THAT THE LOW BIDS FOR EACH ITEM UNDER THE READVERTISED SOLICITATION WERE MORE THAN 40 PERCENT BELOW YOUR PRICES ON THE ORIGINAL IFB, IT WOULD APPEAR THAT THERE IS SUBSTANTIAL SUPPORT FOR THE CONTRACTING OFFICER'S DETERMINATION THAT YOUR PRICES WERE EXCESSIVE.

WITH REGARD TO YOUR ALLEGATION THAT THE CURRENT CONTRACTOR'S PRODUCTS AND DELIVERIES HAVE BEEN INADEQUATE, IT IS REPORTED THAT NO COMPLAINTS HAVE BEEN MADE BY THE RECEIVING ACTIVITIES TO THAT EFFECT, NOR HAVE YOU FURNISHED ANY DOCUMENTATION OF THIS ALLEGATION.

ACCORDINGLY, YOUR PROTEST MUST BE DENIED.