B-180963, SEP 9, 1974

B-180963: Sep 9, 1974

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PROTESTER'S CONTENTIONS THAT IFB FOR 10 YEAR LEASE OF GOVERNMENT PROPERTY BY ARMY CORPS OF ENGINEERS WAS CONTRARY TO 10 U.S.C. 2667. THAT EVALUATION FACTORS LISTED WERE NOT SUFFICIENTLY CLEAR AND COMPLETE. THAT NEW IFB SHOULD HAVE BEEN ISSUED AFTER ALL BIDS RECEIVED UNDER ORIGINAL IFB WERE REJECTED IS UNTIMELY SINCE PROTEST WAS NOT FILED UNTIL AFTER AWARD AND THEREFORE WAS NOT WITHIN TIME LIMITS SPECIFIED IN GAO INTERIM BID PROTEST PROCEDURES AND STANDARDS. ISSUES RAISED ARE NOT SIGNIFICANT TO PROCUREMENT PRACTICES OR PROCEDURES SINCE STATUTORY AND REGULATORY PROVISIONS PROVIDE BROAD DISCRETION IN ARMY TO DETERMINE MANNER AND EXTEND OF COMPETITION NEEDED FOR AWARD OF LEASE. 2. ARMY IS NOT REQUIRED TO MAKE AVAILABLE TO BIDDERS THE APPRAISED FAIR MARKET VALUE OF LAND TO BE LEASED SINCE REGULATIONS WHICH REQUIRE A DETERMINATION OF APPRAISED FAIR MARKET VALUE OF LAND DO NOT REQUIRE THAT APPRAISAL BE MADE PUBLIC.

B-180963, SEP 9, 1974

1. PROTESTER'S CONTENTIONS THAT IFB FOR 10 YEAR LEASE OF GOVERNMENT PROPERTY BY ARMY CORPS OF ENGINEERS WAS CONTRARY TO 10 U.S.C. 2667, THAT EVALUATION FACTORS LISTED WERE NOT SUFFICIENTLY CLEAR AND COMPLETE, AND THAT NEW IFB SHOULD HAVE BEEN ISSUED AFTER ALL BIDS RECEIVED UNDER ORIGINAL IFB WERE REJECTED IS UNTIMELY SINCE PROTEST WAS NOT FILED UNTIL AFTER AWARD AND THEREFORE WAS NOT WITHIN TIME LIMITS SPECIFIED IN GAO INTERIM BID PROTEST PROCEDURES AND STANDARDS, 4 C.F.R. 20.2(A). FURTHERMORE, ISSUES RAISED ARE NOT SIGNIFICANT TO PROCUREMENT PRACTICES OR PROCEDURES SINCE STATUTORY AND REGULATORY PROVISIONS PROVIDE BROAD DISCRETION IN ARMY TO DETERMINE MANNER AND EXTEND OF COMPETITION NEEDED FOR AWARD OF LEASE. 2. ARMY IS NOT REQUIRED TO MAKE AVAILABLE TO BIDDERS THE APPRAISED FAIR MARKET VALUE OF LAND TO BE LEASED SINCE REGULATIONS WHICH REQUIRE A DETERMINATION OF APPRAISED FAIR MARKET VALUE OF LAND DO NOT REQUIRE THAT APPRAISAL BE MADE PUBLIC.

RAMONA SUTFIN:

INVITATION FOR BIDS (IFB) NO. DACA05-74-B-0057 WAS ISSUED BY THE ARMY CORPS OF ENGINEERS ON DECEMBER 11, 1973, FOR THE LEASE OF APPROXIMATELY 10 ACRES OF LAND FOR COMMERCIAL USE. THE LAND IS LOCATED ON A PUBLIC ROAD WITHIN THE HUNTER LIGGETT MILITARY RESERVATION, CALIFORNIA, A DEPARTMENT OF THE ARMY INSTALLATION.

THE LEASE SITE, NAMED JOLON, PRESENTLY INCLUDES A GENERAL STORE WITH RESTAURANT, TRAILER PARK, SERVICE STATION, AND POST OFFICE. IT SERVES MILITARY PERSONNEL, LIMITED AREA RESIDENTS, AND THE TRAVELING PUBLIC.

SINCE 1941, UNDER SUCCESSIVE FIVE YEAR LEASES, SOME 4.75 ACRES OF THIS 10 ACRE PROPERTY, OR ADJACENT PROPERTY HAVE BEEN LEASED BY THE GOVERNMENT TO THE PROTESTER, RAMONA SUTFIN. THE LATEST LEASE EXPIRED ON MARCH 31, 1973, AND HAS BEEN EXTENDED ON A MONTH-TO-MONTH BASIS PENDING THE AWARD OF A NEW LEASE. THE PORTESTER OWNS FACILITIES LOCATED ON THE LAND AND HAS A RIGHT OF REMOVAL. ACCORDING TO THE ARMY, IT RECENTLY DECIDED TO DOUBLE THE AREA TO BE LEASED AND EXTEND THE TERM OF THE LEASE FROM 5 TO 10 YEARS IN ORDER TO ATTRACT MORE BIDDERS AND ENHANCE ADDITIONAL IMPROVEMENTS. APPROVAL TO LEASE FOR A 10 YEAR TERM WAS GRANTED BY THE OFFICE OF ASSISTANT SECRETARY OF THE ARMY (I&L). IN THE IFB, THE ARMY LISTED THE PURPOSES FOR WHICH THE PROPERTY WILL BE LEASED (GENERAL STORE, TRAILER PARK, SERVICE STATION AND RELATED PURPOSES) AND ASKED PROSPECTIVE BIDDERS TO SUBMIT THEIR DEVELOPMENT PLANS FOR THE SITE ALONG WITH AN OFFER OF ANNUAL RENT. HOWEVER, PARAGRAPH 4I OF THE IFB STATED IN PART THAT AWARD OF THE LEASE WOULD BE MADE TO THE BIDDER WHO IS DETERMINED TO BE "*** THE MOST FULLY QUALIFIED FINANCIALLY, BY EXPERIENCE, AND CHARACTER AND OTHERWISE, TO FURNISH THE MOST SATISFACTORY FACILITIES AND SERVICES ***' AND THEREFORE "*** THE SUCCESSFUL BIDDER MAY NOT NECESSARILY BE THE PERSON OFFERING THE HIGHEST ANNUAL RENTAL.

THREE BIDS WERE RECEIVED IN RESPONSE TO THE IFB. IN ORDER OF THE HIGHEST ANNUAL RENTAL THEY WERE AS FOLLOWS:

1. JAMES T. HUGHES & BARBARA HUGHES $3,720.00

2. RAMONA SUTFIN DBA JOLON STORE 3,708.40

3. ROBERT S. GREGORY DBA KING CITY

COLD STORAGE 2,856.86

THE ARMY REPORTS THAT DUE TO INFORMAL INFORMATION GIVEN BY THE POST COMMANDER TO MR. GREGORY HIS BID INCLUDED PLANS TO UTILIZE A TRIANGULAR PEICE OF LAND BETWEEN THE 10 ACRE TRACT AND THE PUBLIC ROADS WHICH WAS NOT INTENDED TO BE INCLUDED IN THE LEASED AREA. SINCE THE OTHER BIDDERS HAS NOT RECEIVED THE SAME INFORMATION, ALL OF THE BIDS WERE REJECTED AND EACH BIDDER WAS ADVISED IN EARLY FEBRUARY 1974 THAT THE ADDITIONAL TRIANGULAR AREA WAS AVAILABLE FOR LEASE; THAT IT COULD BE UTILIZED IN THE DEVELOPMENT PLANS; AND THAT "NEW PROPOSALS" COULD BE SUBMITTED BY MARCH 1, 1974. SUAFTER REVISED BIDS WERE RECEIVED, THE STANDINGS OF THE THREE ORIGINAL BIDDERS REMAINED THE SAME, WITH PROPOSED ANNUAL RENTALS AS FOLLOWS:

1. JAMES T. HUGHES & BARBARA HUGHES $4,429.00

2. RAMONA SUTFIN DBA JOLON STORE 3,958.40

3. ROBERT S. GREGORY DBA KING CITY

COLD STORAGE 2,856.86

ON MARCH 19, 1974, ROBERT S. GREGORY DBA KING CITY COLD STORAGE WAS AWARDED THE LEASE AND THE OTHER BIDDERS WERE SO NOTIFIED. THE ARMY REPORT STATES THAT THE AWARD WAS MADE TO GREGORY BECAUSE HIS SUBMITTAL:

"*** WAS SUPERIOR IN THE MAIN OBJECTIVE OF OBTAINING GOOD, WELL OPERATED FACILITIES NEEDED FOR THE GENERAL AREA, EVEN THOUGH THE AMOUNT OF ANNUAL RENTAL TO THE GOVERNMENT WAS SOMEWHAT LESS THAN HUGHES OR SUTFIN (BUT STILL HIGHER THAN THE APPRAISED VALUE)."

THE ABOVE PARENTHETICAL STATEMENT REFERS TO THE FACT THAT A REQUIRED MINIMUM ANNUAL RENTAL OF $1,500.00 WAS ESTABLISHED BY A GOVERNMENT APPRAISAL OF DECEMBER 11, 1973.

BY LETTER DATED MARCH 26, 1974 (RECEIVED ON MARCH 29) COUNSEL FOR RAMONA SUTFIN PROTESTED THE AWARDING OF THE LEASE ON THE BASIS THAT THE 10 YEAR LEASE PERIOD WAS CONTRARY TO 10 U.S.C. 2667; THAT THE AWARD FACTORS DESCRIBED ON PAGE 4 OF THE IFB WERE NOT SUFFICIENTLY CLEAR AND COMPLETE; THAT THERE WAS NO APPRAISED RENTAL VALUE OF RECORD AVAILABLE TO THE BIDDERS; AND THAT AFTER THE INITIAL BID OPENING THE SOLICITATION SHOULD HAVE BEEN CANCELED AND A NEW SOLICITATION ISSUED.

OUR INTERIM BID PROTEST PROCEDURES AND STANDARDS (SECTION 20.2(A) OF TITLE 4 OF THE CODE OF FEDERAL REGULATIONS) REQUIRE THAT PROTESTS BASED UPON ALLEGED IMPROPRIETIES IN ANY TYPE OF SOLICITATION WHICH ARE APPARENT PRIOR TO BID OPENING OR THE CLOSING DATE FOR RECEIPT OF PROPOSALS SHALL BE FILED PRIOR TO BID OPENING OR THE CLOSING DATE FOR RECEIPT OF PROPOSALS. IN OTHER CASES, BID PROTESTS MUST BE FILED IN OUR OFFICE NOT LATER THAN FIVE WORKING DAYS AFTER THE BASIS FOR PROTEST IS KNOWN OR SHOULD HAVE BEEN KNOWN, WHICHEVER IS EARLIER. HERE, THE CONTENTIONS THAT THE 10 YEAR LEASE PERIOD WAS CONTRARY TO LAW AND THAT THE AWARD FACTORS DESCRIBED ON PAGE 4 OF THE IFB WERE NOT SUFFICIENTLY CLEAR AND COMPLETE CONCERN ALLEGED IMPROPRIETIES IN THE SOLICITATION AND THUS ANY PROTEST CONCERNING THEM SHOULD HAVE BEEN FILED PRIOR TO BID OPENING. SIMILARLY, THE CLAIM THAT A NEW IFB SHOULD HAVE BEEN ISSUED CONCERNS A CHALLENGE TO PROCEDURES WHICH WERE KNOWN TO THE PROTESTER ALMOST TWO MONTHS PRIOR TO THE FILING OF THE PROTEST. THEREFORE, THE PROTEST WITH RESPECT TO THESE ISSUES MUST BE REGARDED AS UNTIMELY. 53 COMP. GEN. 139 (1973).

THE PROTESTER ASSERTS, HOWEVER, THAT THESE ISSUES ARE SIGNIFICANT AND THEREFORE SHOULD BE CONSIDERED PURSUANT TO 4 C.F.R. 20.2(B), WHICH PROVIDES THAT UNTIMELY PROTESTS MAY BE CONSIDERED IF THEY RAISE ISSUES "SIGNIFICANT TO PROCUREMENT PRACTICES OR PROCEDURES." WE NOTE, HOWEVER, THAT THE ACTIONS COMPLAINED OF WERE TAKEN BY THE CORPS OF ENGINEERS PURSUANT TO 10 U.S.C. 2667, AND IMPLEMENTING REGULATIONS OF THE DEPARTMENT OF THE ARMY AND THE CORPS OF ENGINEERS. WE HAVE PREVIOUSLY RECOGNIZED THAT 10 U.S.C. 2667, WHICH AUTHORIZES THE SECRETARY OF THE ARMY TO LEASE CERTAIN PROPERTY "UPON SUCH TERMS AS HE CONSIDERS WILL PROMOTE THE NATIONAL DEFENSE OR BE IN THE PUBLIC INTEREST," VESTS "BROAD LESING AUTHORITY" IN THE SECRETARY. B-174833, MARCH 10, 1972. ENGINEER REGULATION (ER) 405-1-800 PROVIDES THAT "REASONABLE EFFORTS *** TO OBTAIN COMPETITION THROUGH ADVERTISING" SHOULD BE MADE PRIOR TO AWARDING A LEASE, BUT THAT THE "DISTRICT ENGINEER WILL DETERMINE THE METHOD OF OBTAINING COMPETITION." THESE PROVISIONS APPEAR TO GIVE THE ARMY A BROAD RANGE OF DISCRETION IN DETERMINING THE EXTENT AND MANNER OF COMPETITION LEADING TO THE AWARD OF A LEASE. THEREFORE, WE ARE OF THE VIEW THAT THE ISSUES RAISED BY THIS PROTEST ARE NOT SIGNIFICANT TO GENERAL PROCUREMENT PRACTICES OR PROCEDURES. ACCORDINGLY, WE MUST DECLINE TO CONSIDER THEM ON THE MERITS.

AS FOR THE PROTESTER'S CONTENTION THAT THERE WAS NO APPRAISED RENTAL VALUE OF RECORD AVAILABLE TO THE BIDDERS, WE NOT THAT ALTHOUGH PARAGRAPH 2 -6 OF ER 405-1-800 AND PARAGRAPH 9 OF ER 405-1-830 REQUIRE A DETERMINATION OF THE APPRAISED FAIR MARKET VALUE OF PROPERTY TO BE LEASED, NEITHER REGULATION REQUIRES THAT THE APPRAISAL BE MADE PUBLIC. AN APPRAISAL REPORT, DATED DECEMBER 11, 1973, WAS MADE AND WAS CONSIDERED IN EVALUATING THE BIDS. THEREFORE, THE FACT THAT THE APPRAISED MARKET VALUE OF RECORD WAS NOT MADE PUBLIC DID NOT VIOLATE THE APPLICABLE REGULATIONS.