B-180393, APR 10, 1974

B-180393: Apr 10, 1974

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

WHERE BIDDER SUBMITS LOW PRICES FOR REQUIRED QPL ITEMS AND WHEN CONTACTED VERIFIES THAT IT WILL INDEED SUPPLY QPL ITEMS. BID WOULD APPEAR TO CONFORM TO IFB REQUIREMENTS AND AWARD WAS PROPER. STATES THAT ITEMS 0017 AND 0018 ARE "NOT SEPARATELY PRICED. " DEVIATION FROM IFB CAN BE WAIVED AS MINOR INFORMALITY SINCE UNLIKE A FAILURE TO MAKE ANY INDICATION RELATIVE TO ITEMS HERE BIDDER IS NOT RELIEVED OF HIS OBLIGATION TO FURNISH BOTH ITEMS. UPON OPENING IT WAS DETERMINED THAT THE BID OF TELE-DYNAMICS DIVISION OF AMBAC INDUSTRIES. 623) WAS LOW. NELSON'S PROTEST WAS DENIED BY THE AGENCY BY A LETTER DATED DECEMBER 28. AWARD TO TELE-DYNAMICS WAS MADE LATER THAT DAY BASED ON THE FACT THAT THE CONTRACTING OFFICER HAD MADE A DETERMINATION PURSUANT TO ASPR 2- 407.8(B)(3) THAT DELIVERY OR PERFORMANCE WOULD BE UNDULY DELAYED BY FAILURE TO MAKE PROMPT AWARD.

B-180393, APR 10, 1974

1. WHERE BIDDER SUBMITS LOW PRICES FOR REQUIRED QPL ITEMS AND WHEN CONTACTED VERIFIES THAT IT WILL INDEED SUPPLY QPL ITEMS, BID WOULD APPEAR TO CONFORM TO IFB REQUIREMENTS AND AWARD WAS PROPER. FACT THAT BIDDER MAY SUSTAIN LOSS IN PERFORMING AT ITS BID PRICE (A QUESTION OF RESPONSIBILITY) DOES NOT JUSTIFY REJECTION OF OTHERWISE ACCEPTABLE BID. 2. WHERE BIDDER SUBMITS AGGREGATE PRICE FOR ALL ITEMS, BUT STATES THAT ITEMS 0017 AND 0018 ARE "NOT SEPARATELY PRICED," DEVIATION FROM IFB CAN BE WAIVED AS MINOR INFORMALITY SINCE UNLIKE A FAILURE TO MAKE ANY INDICATION RELATIVE TO ITEMS HERE BIDDER IS NOT RELIEVED OF HIS OBLIGATION TO FURNISH BOTH ITEMS.

TO NELSON ELECTRIC DIVISION OF SOLA BASIC INDUSTRIES:

INVITATION FOR BIDS (IFB) N00017-74-B-4001, ISSUED BY THE NAVAL ORDNANCE SYSTEMS COMMAND ON SEPTEMBER 18, 1973, REQUESTED BIDS ON A NUMBER OF SWITCHBOARDS AND ASSOCIATED ITEMS.

UPON OPENING IT WAS DETERMINED THAT THE BID OF TELE-DYNAMICS DIVISION OF AMBAC INDUSTRIES, INC. (TELE-DYNAMICS) ($382,623) WAS LOW. SUBSEQUENT TO OPENING NELSON ELECTRIC DIVISION OF SOLA BASIC INDUSTRIES (NELSON), THE THIRD LOW BIDDER ($492,500), PROTESTED TO THE AGENCY (WITH COPIES TO OUR OFFICE) ANY AWARD BEING MADE TO TELE-DYNAMICS. NELSON'S PROTEST WAS DENIED BY THE AGENCY BY A LETTER DATED DECEMBER 28, 1973, AND AWARD TO TELE-DYNAMICS WAS MADE LATER THAT DAY BASED ON THE FACT THAT THE CONTRACTING OFFICER HAD MADE A DETERMINATION PURSUANT TO ASPR 2- 407.8(B)(3) THAT DELIVERY OR PERFORMANCE WOULD BE UNDULY DELAYED BY FAILURE TO MAKE PROMPT AWARD. (INDEED, OUR OFFICE HAS JUST RECENTLY RECOMMENDED UTILIZATION OF SUCH A PROCEDURE UPON THE AGENCY'S DENIAL OF A PROTEST WHICH IT REASONABLY, AS HERE, CONTEMPLATES WILL BE CONTINUED AT GAO. 53 COMP. GEN. (B-179835, JANUARY 29, 1974).)

NELSON'S PROTEST INVOLVES THE ASSERTIONS THAT (1) SINCE ITEMS 2, 6, 10, AND 14 OF THE IFB REQUIRE THE USE OF QUALIFIED PRODUCTS LIST (QPL) CONNECTORS BUT TELE-DYNAMICS' BID PRICES FOR THESE ITEMS ARE ALLEGEDLY LOWER THAN THE WHOLESALE QUOTE OF THE SOLE QPL MANUFACTURER, TELE DYNAMICS EITHER DOES NOT INTEND TO SUPPLY QPL ITEMS OR ELSE IS "BUYING IN," AND (2) SINCE TELE-DYNAMICS DID NOT SUBMIT A SEPARATE PRICE FOR ITEMS 0017 AND 0018 (ALTHOUGH IT DID SUBMIT A TOTAL PRICE), ITS BID SHOULD HAVE BEEN DECLARED NONRESPONSIVE.

WITH REGARD TO NELSON'S ALLEGATION REGARDING QPL CONNECTORS, THE NAVY STATES THAT IT HAS CONFIRMED WITH TELE-DYNAMICS THAT THE CONTRACTOR WILL PROVIDE QPL CONNECTORS. CONSEQUENTLY, TELE-DYNAMICS' BID WOULD APPEAR TO CONFORM TO THE SOLICITATION REQUIREMENTS IN THIS RESPECT.

MOREOVER, NELSON'S FURTHER CONTENTION THAT TELE-DYNAMICS BY OFFERING SUCH A LOW PRICE ON THE ITEMS IN QUESTION ACTED IMPROPERLY IS ALSO WITHOUT MERIT. OUR OFFICE HAS CONSISTENTLY HELD THAT THE SUBMISSION OF LOW PRICE IS NOT NECESSARILY A BASIS TO CHALLENGE THE BID. B-175284, MAY 2, 1972; B -179002, DECEMBER 18, 1973. THE QUESTION OF WHETHER THE BIDDER CAN PERFORM AT ITS BID PRICE IS ONE OF RESPONSIBILITY. B 179002, SUPRA, CITING B-173916, APRIL 20, 1972. MOREOVER, THE FACT THAT A BIDDER MAY SUSTAIN A LOSS IN PERFORMING THE CONTRACT AT ITS BID PRICE DOES NOT JUSTIFY THE REJECTION OF AN OTHERWISE ACCEPTABLE BID. B 179002, SUPRA.

ASPR 1-311 DOES, HOWEVER, SEEK TO PROTECT AGAINST THE EFFECTS OF BUYING IN, STATING THAT:

"*** WHERE THERE IS REASON TO BELIEVE THAT 'BUYING IN' HAS OCCURRED, CONTRACTING OFFICERS SHALL ASSURE THAT AMOUNTS THEREBY EXCLUDED IN THE DEVELOPMENT OF THE ORIGINAL CONTRACT PRICE ARE NOT RECOVERED IN THE PRICING OF CHANGE ORDERS OR OF FOLLOW-ON PROCUREMENTS SUBJECT TO COST ANALYSIS."

WITH REGARD TO TELE-DYNAMICS' FAILURE TO SUBMIT SEPARATE PRICES FOR ITEMS 0017 AND 0018, THE IFB'S "EVALUATION FACTORS FOR AWARD" STATED:

"1. EVALUATION OF BIDS AND AWARD. ATTENTION IS DIRECTED TO PARAGRAPH 10(A) OF THE SOLICITATION INSTRUCTIONS AND CONDITIONS (STANDARD FORM 33A) WHICH PROVIDES THAT THE CONTRACT WILL BE AWARDED TO THAT RESPONSIBLE OFFEROR WHOSE OFFER, CONFORMING TO THE SOLICITATION, WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED. ***

WHILE THE IFB DID LIST 18 ITEMS, IT IS APPARENT FROM THE LANGUAGE NOTED ABOVE THAT A SINGLE BIDDER WAS CONTEMPLATED AS THE EVENTUAL CONTRACTOR FOR ALL 18 ITEMS. FURTHER, TELE-DYNAMICS DID NOT LEAVE ITEMS 0017 AND 0018 BLANK BUT INDICATED THAT ITEM 0017 (TECHNICAL DATA REQUIREMENTS FOR THE ITEMS IN QUESTION) AND ITEM 0018 (ENGINEERING REVIEW OF A SPECIFIC SWITCHBOARD) WERE NOT SEPARATELY PRICED.

IN B-161012, JUNE 13, 1967, WE STATED THAT:

"*** SINCE THE AWARD WAS TO BE MADE IN THE AGGREGATE AND AN AGGREGATE TOTAL PRICE WAS INVITED, INDIVIDUAL ITEM PRICES WERE NOT MATERIAL TO THE EVALUATION OF BIDS AND THE FAILURE TO QUOTE INDIVIDUAL ITEM PRICES SHOULD HAVE BEEN WAIVED AS A MINOR DEVIATION. ***"

IN THIS REGARD, SEE B-176425, OCTOBER 18, 1972.

INDEED, THE INCLUSION OF "NOT SEPARATELY PRICED" FOR ITEMS 0017 AND 0018, WHEN AN AGGREGATE TOTAL PRICE IS PROVIDED, UNLIKE A FAILURE TO MAKE ANY INDICATION RELATIVE TO THE ITEMS, WOULD NOT RELIEVE TELE DYNAMICS OF THE OBLIGATION TO FURNISH BOTH ITEMS. B-161012, SUPRA; SEE 48 COMP. GEN. 757, 762 (1969). WE THEREFORE CONCUR IN THE CONTRACTING OFFICER'S WAIVER OF THE MINOR DEVIATION IN TELE-DYNAMICS' BID.

NELSON ADDITIONALLY STATES THAT IT HAS INFORMATION THAT ON PAST CONTRACTS TELE-DYNAMICS HAS BID QPL CONNECTORS BUT HAS FAILED TO SUPPLY SAME, IN EACH CASE RECEIVING A WAIVER OF THE SPECIFICATION. WE HAVE BEEN ADVISED BY THE NAVY THAT IN EACH OF THE SITUATIONS REFERRED TO BY NELSON (THE DLG- 36 AND -37 SHIPS) TELE-DYNAMICS DID PROVIDE THE REQUISITE QPL CONNECTORS.

FOR THE REASONS NOTED ABOVE WE SEE NO BASIS TO CHALLENGE THE ACCEPTANCE OF TELE-DYNAMICS' BID. NELSON'S PROTEST IS THEREFORE DENIED.