B-180456(2), NOV 11, 1974

B-180456(2): Nov 11, 1974

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WHERE IFB CLEARLY IMPLIED THAT EACH BIDDER AS CONDITION OF ENTITLEMENT TO AWARD MUST DESIGNATE BY TAIL NUMBER AND HAVE AVAILABLE THE SPECIFIED AIRCRAFT THAT IT WOULD USE ON GIVEN ITEM. BIDDER AT TIME OF AWARD DID NOT HAVE CONTROL OF SPECIFIED AIRCRAFT. AWARD IS IMPROPER. 2.EVEN THOUGH SUCCESSFUL BIDDER MADE DECLARATION IN BID THAT IT MERGED WITH ANOTHER ORGANIZATION AND THUS HAD ACCESS TO THAT FIRM'S AIRCRAFT. IN FACT MERGER WAS NEVER CONSUMMATED AS CAB APPROVAL NEVER ISSUED. AWARD WAS IMPROPER DUE TO BIDDER'S LACK OF CONTROL OF AIRCRAFT. TERMINATION FOR CONVENIENCE OF GOVERNMENT IS NOT RECOMMENDED SINCE CONTRACT PERIOD ENDED SEPTEMBER 30. THE IFB WAS ISSUED BY THE FOREST SERVICE AND WAS THE SUBJECT OF DECISION B-180456.

B-180456(2), NOV 11, 1974

1. WHERE IFB CLEARLY IMPLIED THAT EACH BIDDER AS CONDITION OF ENTITLEMENT TO AWARD MUST DESIGNATE BY TAIL NUMBER AND HAVE AVAILABLE THE SPECIFIED AIRCRAFT THAT IT WOULD USE ON GIVEN ITEM, BUT BIDDER AT TIME OF AWARD DID NOT HAVE CONTROL OF SPECIFIED AIRCRAFT, AWARD IS IMPROPER. 2.EVEN THOUGH SUCCESSFUL BIDDER MADE DECLARATION IN BID THAT IT MERGED WITH ANOTHER ORGANIZATION AND THUS HAD ACCESS TO THAT FIRM'S AIRCRAFT, BUT IN FACT MERGER WAS NEVER CONSUMMATED AS CAB APPROVAL NEVER ISSUED, AWARD WAS IMPROPER DUE TO BIDDER'S LACK OF CONTROL OF AIRCRAFT; HOWEVER, TERMINATION FOR CONVENIENCE OF GOVERNMENT IS NOT RECOMMENDED SINCE CONTRACT PERIOD ENDED SEPTEMBER 30, 1974.

CENTRAL AIR SERVICE:

THE SUBJECT PROTEST CONCERNS THE AWARD OF ITEMS 4A AND 4B OF INVITATION FOR BIDS (IFB) FS-4-74. THE IFB WAS ISSUED BY THE FOREST SERVICE AND WAS THE SUBJECT OF DECISION B-180456, DATED MAY 16, 1974.

AS NOTES IN THE EARLIER DECISION:

"*** IN VIEW OF THE VERY UNIQUE SITUATION RELATIVE TO THE FOREST SERVICES'S NEEDS FOR FIREFIGHTING EQUIPMENT, THE SUBJECT IFB SOUGHT BIDS ON A LINE ITEM BASIS FOR AIR TANKER SERVICES AT VARIOUS BASES THROUGHOUT THE UNITED STATES AND ALLOWED BIDDERS TO BID INDIVIDUAL AIRCRAFT BY ORDER OF PREFERENCE ON 33 ITEMS IN THE SCHEDULE."

THE IFB WAS STRUCTURED TO PAY EACH CONTRACTOR AN "AVAILABILITY RATE" SPECIFIED BY THE FOREST SERVICE FOR EACH BASE DURING THE PERIOD IN WHICH THE PLANE WAS REQUIRED TO BE AVAILABLE AT THAT BASE. IN ADDITION, EACH CONTRACTOR WOULD BE PAID ITS BID PRICE PER ACTIVE FLIGHT HOUR. WITH REGARD TO ITEMS 4A AND 4B, THE AIRCRAFT WERE REQUIRED TO BE AVAILABLE FROM JUNE 3, 1974, TO SEPTEMBER 30, 1974.

IN THE EARLIER DECISION, AFTER CONSIDERABLE DISCUSSION OF THE RAMIFICATIONS OF THE IFB'S PREFERENCE SYSTEM, OUR OFFICE CONCLUDED THAT:

"JOHNSON (FLYING SERVICE, INC.) WAS THE LOW BIDDER ON SUBITEMS 4A AND 4B; 4B WAS ITS FIRST PREFERENCE FOR N14447, 4A WAS ITS SECOND PREFERENCE FOR N14448 AND THIS AIRCRAFT HAD NOT BEEN PREVIOUSLY AWARDED ON ANY HIGHER OFFERED PREFERENCE. JOHNSON APPEARS TO BE THE LOW RESPONSIBLE BIDDER FOR ITEM 4 AND WOULD APPEAR TO BE THE LOGICAL AWARDEE."

IN THAT REGARD, THE ABSTRACT OF BIDS APPEARED AS FOLLOWS:

PRICE PER

ITEM FLIGHT HOUR PREFERENCE AIRCRAFT

4A JOHNSON $386.23 (2) P2-V N14448

CENTRAL 424.00 (1) DC-7 816D

4B JOHNSON 386.23 (1) P2-V N14447

CENTRAL 424.00 (1) DC-7 848D

DUE TO THE URGENT NEED FOR THE SERVICES IN QUESTION, ITEMS 4A AND 4B WERE AWARDED TO JOHNSON ON MAY 8, 1974, PRIOR TO THE ISSUANCE OF OUR DECISION.

HOWEVER, THE MAY 16 DECISION STATED THAT THE IFB HAD CLEARLY IMPLIED, BY ALLOWING BIDDERS TO STATE PREFERENCES FOR THE PLACEMENT OF THEIR AIRCRAFT, THAT EACH BIDDER, AS A CONDITION OF ENTITLEMENT TO AWARD, WAS REQUIRED TO DESIGNATE BY TAIL NUMBER AND HAVE AVAILABLE THE SPECIFIC AIRCRAFT THAT IT WOULD USE ON THE GIVEN ITEM.

ACCORDINGLY, ON MAY 24, 1974, THE FOREST SERVICE ISSUED A CURE NOTICE TO JOHNSON REQUIRING IT TO DEMONSTRATE THAT IT HAD CONTROL OF THE TWO AIRCRAFT WHICH IT HAD BID ON ITEMS 4A AND 4B OR BE TERMINATED FOR DEFAULT. A MEETING WITH JOHNSON WAS HELD ON MAY 31, 1974, AT WHICH TIME IT PRESENTED A FIRM LEASE FOR N14447 AND N14448 WITH THE FLYING FIREMEN (MR. RICHARD RUDE).

THE QUESTION IN THE INSTANT CASE IS WHETHER AT THE TIME OF AWARD JOHNSON HAD SUCH CONTROL OVER THE SPECIFIED AIRCRAFT THAT THE FOREST SERVICE COULD ASCERTAIN THAT NO PREVIOUS COMMITMENT OF THAT CRAFT HAD BEEN MADE. SUPPORT OF THE AWARD, THE FOREST SERVICE REFERENCES THE FACT THAT ATTACHED TO JOHNSON'S BID WAS A LETTER DATED JANUARY 12, 1974, WHICH STATED:

"PLEASE BE ADVISED THAT MR. RICHARD RUDE, *** IS NOT SUBMITTING A BID RESPONSE TO THE ABOVE-REFERENCED INVITATION FOR AIR TANKER SERVICES.

"MR. RUDE HAS ACQUIRED AN INTEREST IN JOHNSON FLYING SERVICE AND ALL OF HIS AVAILABLE TANKER AIRCRAFT HAS NOW BECOME A PART OF THE JFS OVERALL FLEET."

PRESUMABLY, MR. RUDE WAS THE OWNER AT THAT TIME OF BOTH N14447 AND N14448.

THE FOREST SERVICE, HOWEVER, ALSO INDICATES THAT ON MAY 1, 1974, JUST 7 DAYS PRIOR TO AWARD, A MEETING WAS HELD WITH JOHNSON AND OTHERS AT WHICH TIME IT WAS DISCLOSED THAT MR. RUDE HAD NOT IN FACT CONSUMMATED THE PURCHASE OF JOHNSON (THE REQUISITE CIVIL AERONAUTICS BOARD (CAB) APPROVAL NOT HAVING BEEN ISSUED) AND THAT, INDEED, MR. RUDE CONTINUED TO EXERCISE CONTROL OVER THE SUBJECT AIRCRAFT (A FACT BORNE OUT ON MAY 29 IN THAT MR. RUDE'S COMPANY SUBMITTED A BID ON ANOTHER FOREST SERVICE SOLICITATION INDICATING ITS INTENDED USE OF N14447 AND N14448).

NOTWITHSTANDING THE FACT THAT THE FOREST SERVICE KNEW THAT JOHNSON DID NOT EITHER OWN OR HAVE A LEASE ON THE SUBJECT AIRCRAFT, AWARD WAS MADE TO JOHNSON. IN VIEW OF OUR EARLIER INTERPRETATION OF THE IFB, THIS AWARD WAS IMPROPER AS JOHNSON WAS INELIGIBLE ON THESE ITEMS FOR LACK OF CONTROL OF THE AIRCRAFT. WE NOTE THAT EVEN THOUGH JOHNSON DID IN FACT PERFORM THE CONTRACT WITH THE AIRCRAFT IT HAD INDICATED IN ITS BID, THE FACT REMAINS THAT AT THE CRITICAL JUNCTURE JOHNSON DID NOT MEET A MATERIAL CONDITION FOR ENTITLEMENT TO AWARD. ORDINARILY, SUCH CIRCUMSTANCE MIGHT REQUIRE A RECOMMENDATION THAT THE CONTRACT BE TERMINATED FOR THE CONVENIENCE OF THE GOVERNMENT. SEE 53 COMP. GEN. 434 (1973). HOWEVER, OUR OFFICE DOES NOT RECOMMEND CORRECTIVE ACTION ON THIS PROCUREMENT BECAUSE (1) THE CONTRACT PERFORMANCE PERIOD FOR THE ITEMS IN QUESTION ENDED ON SEPTEMBER 30, 1974, AND (2) THE FOREST SERVICE HAS ADVISED US OF ITS INTENTION NOT TO EXERCISE THIS OR ANY OTHER SIMILAR OPTION FOR AIR TANKER SERVICES.

WE DO, HOWEVER, SUGGEST THAT THE FOREST SERVICE TAKE APPROPRIATE STEPS TO ASSURE THAT IN THE FUTURE THERE WILL BE STRICT COMPLIANCE WITH PROPER PROCUREMENT PROCEDURE.